THE TAXATION OF EMPLOYEE REVENUE FROM THE FRINGE BENEFITS

The article presents the issues taxation of employee revenue from the fringe benefits by Personal Income Tax. On the one hand, the employee fringe benefits are identified with a defined benefit and on the other with a non-monetary incentive system. However, the benefits give rise to many doubts and controversies. The reasons for this are the lack of legal definition and the lack of their legal directory. Therefore, the views of the judiciary and decisions of tax authorities indicate for example what can be classified fringe benefits.


INTRODUCTION REMARKS
The Personal Income Tax Act 1 provides for the possibility of obtaining tax revenue from fringe benefits.In doctrine, these employee benefits refers mainly to the aspect of positive motivational influence -the effectiveness of the work performed and the resulting real benefits on the part of employees and employers2 .The benefits are identified with additional complement the basic remuneration 3 .
The basis for receiving fringe benefits is to establish an employment relationship.This should be understood as the specific legal relationship that connects the employee with the employer.It signifies the obligation to perform certain types of work under the direction of the employer and at the place and time designated by him.In addition, the employer is obliged to employ for remuneration with which the employee's income is connected.
According to the tax law income from employment can be the value of other fringe benefits 4 .Unfortunately, there is no legal definition of these benefits.Helpful in interpreting the concept are the decisions of the tax authorities and jurisdiction which create a quasi catalogue.The interpretation of the concept is problematic because the lack of definitions in tax legislation leads to divergences in the application of the law.Moreover, it is a risk for tax authorities and taxpayers in identifying tax obligations 5 .It is assumed that fringe benefits are all legal or economic facts, which result in free (not related to costs or other form of equivalent) increment in the taxpayer's assets that has a concrete financial dimension 6 .It is important to emphasize of the judgment of the Constitutional Court of July 8 2014, signature act K 7/13.The Constitutional Court pointed out the basic criteria for taxation of revenue from fringe benefits.
To be able to talk about the employee revenues from fringe benefits must be fulfilled three mandatory conditions.Firstly, the employee has used them voluntarily, he agreed to it.Secondly, the employee has ben-efited in the form of an increase in assets or a loss of expenses.Thirdly, the benefits must be individual and assigned to a particular employee 7 .

THE EMPLOYEE'S FRINGE BENEFITS. SELECTED ISSUES
The administrative jurisdiction in relation to the medical services packages 8 was very different 9 .However, two important resolutions of the Supreme Administrative Court 10 must be presented which unambiguously resolved and unified the issue the taxation of medical packages even before the judgment of the Constitutional Court 11 .
According to arrangements, the value of benefits in the form of medical services packages is employee revenue.Importantly, it is created when the employee receives the opportunity to use the package.Therefore, it does not matter if the employee has actually used the service.This aspect does not affect the tax revenue 12 .As a result, the fact of granting a medical services is a real benefit to him in avoiding any expense 13 .The possibility of using the medical services package has a significant financial dimension.It is worth emphasizing that if an employee wanted to use medical services himself, he would have to buy him for a higher amount than the employer.Consequently, the beneficiary receives a specific financial contribution 14 .
The purchase of a medical package is characterized by certain features.They imply the occurrence of fringe benefits received to employees.In this context, there are three main characteristics of a medical services: -legal events that have a specific financial dimension; -this is an employee's right; -this is the consequence of the law, the possibility of free use of the services included in the package 15 .The Supreme Administrative Court emphasized that, as a consequence, the inclusion of medical package resulted in income.The employer, as a payer is obliged to add to the employee's remuneration paid during the month the value of medical benefits and to pay Personal Income Tax 16 .
The benefit value is equal to the value of the transferred medical service package.Is determined by the price which the employer has actually acquired them.Under the law, the price is a remuneration.The provider is paid for medical services and is not dependent on the amount of benefits received 17 .
In conclusion, the financing of medical service packages by an employer fulfills not only the employee functions, but also important social func- tions.Firstly, it contributes to the development of the private sector of medical services, secondly support of public health18 .However, their weakness is high operating costs, especially in the most advanced and specialized medical services 19 .
Providing employees a business car for private purposes is a benefit for them.Its value qualifies as income from the employment relationship 20 , which employer should add to the "ordinary" employee income 21 .However, that benefit must be a fringe.Therefore, when the use of cars for private purposes is made on the basis of lease agreements no revenue 22.In the context of fringe benefits, employers have raised doubts in determining their value.It was assumed that the value of benefits should be determined, for example, based on the cost of renting as in a professional car rental company 23 .
The Act on facilitating the establishment of a business activity 24 has introduced a new accounting system for the provision of benefits for the use of corporate cars for private purposes.As a result, the benefits value is determined on a lump sum basis.The amount set depends only on the engine capacity 25 .Moreover, under the law the employer is not obliged to record the course of the car to determine the value of the benefit 26 .
The new rules apply only to accounts of employees who are employed under a contract of employment.In other cases, the value of benefits is determined on the basis of the general rules resulting from the provisions of the Personal Income Tax 27 .Importantly, there is no income if the vehicle is used only for business purposes 28 .It is important to distinguish between the private purposes of the business.The business purpose is to use a car when an employee performs his obligations resulting from a contract of employment, for example sales representatives.The car is an aid in the effective implementation of its employee duties.
Another a fringe benefit is the use of business telephones for private purposes.This is a form of motivation and attachment of the employee to the company.Today, a business phone is often a mandatory piece of equipment for every employee.Consequently, this affects the availability of the employee and the quality of the work performed 29 .
Due to the possibility of using the phone for private purposes, certain conditions must be fulfilled.The phone must be used for private purposes and the employer does not charge the employee.Which ultimately leads to an individual, personal benefit for the employee.In view of these condi-tions, the employer is obliged to fulfill the responsibilities of the payer 30 .In addition, according to the interpretation of the Constitutional Court the employee must voluntarily agree to use the telephone.Also, the employer will be able to determine the extent to which the phone was used for private purposes, even if it was based on billing 31 .
In decisions of the tax authorities co-financing for corrective glasses is fringe of benefits.However, in principle the resulting revenue from them is not subject to tax.In accordance with the Regulation of the Minister of Labor and Social Policy, the employer is obliged to provide corrective glasses with a total of three conditions.Firstly, their use is in line with the doctor's recommendation.Secondly, if the results of the ophthalmic examination indicate the need to use them.Thirdly, the employee must work at the computer monitor 32 .As a consequence, after the fulfillment of these conditions co-financing for corrective glasses is free of Personal Income Tax 33 .
There are situations where revenue from co-financing for corrective glasses is subject to tax.A necessary condition is a doctor's recommendation, but what is important during optional medical examinations.The employee has the right to request a non-prophylactic examination.In other words, it is a medical examination between mandatory periodic examinations 34 .If doctor finds a deterioration in vision the employee is entitled to purchase corrective glasses with the help of the employer's resources 35 .The result of the medical examination obliges the employer to provide the corrective glasses 36.In summary, the cost of refund for corrective glasses is additional to the employee.This amount generates income from the employment relationship.
The last example of fringe benefit, which is generated revenue from the employment relationship is additional employee health insurance.This benefit is financed by the employer and is an asset to the employee.Consequently, it is a relief from incurring additional costs 37 .According to the opinion of the Supreme Administrative Court agreement of medical services packages and agreement of health insurance are the same.Moreover, to ensure medical care in the package is a kind of private health insurance.The most important is the possibility of using medical services, rather than the specific medical services performed by the employee.The employer does not purchase specific services, because at the time of signing the agreement the amount or type of benefits actually realized is not known 38 .
According to the law and the case law there are employee benefits which are not taxation by Personal Income Tax.
Among the tax authorities was the view that employee integration events are fringe and taxable by Personal Income Tax.It was emphasized that from a tax point of view the quantity and quality of food or attractions used by an employee is irrelevant.However, in the judgment of most courts where the value of benefits cannot be attributed to a particular person and the fee is paid on a lump sum, it is impossible to determine the amount of income earned from a meeting for an individual employee.There is no basics to conclude the fact that an employee has actually received a service and stated its value 39 .The Constitutional Court's judgment clearly stated that employee integration events do not generate revenue which in consequence would be taxable to income 40 .
On the basis of this judgment changes were made to the views of tax authorities.One of them is an adjustment of the Minister of Finance interpretation's which confirms that integration events are not taxable.Not every the free of charge employee benefits are taxable by Personal Income Tax 41 .
An example of this is the tasting of meals by the kitchen staff in the school canteen.It cannot be assumed that these persons receive real benefits in the form of meals.The specificity of the occupation requires them to tasting the meals in different stages of their preparation and is an essential part of proper performance of entrusted duties.Thus, there is no income from free of charge employee benefits and employers are not obliged to pay the payer in this regard 42 .
In addition, the provision of accommodation by the employer is not taxable.In justifying its decision the Constitutional Tribunal stated that all costs of accommodation, which result from the work performed at the place and time specified by the employer do not generate revenue 43 .In other words, if from employment agreement result that the employee's duties are performed outside of the place of residence is an consequence of the employee revenue does not occur.
The provision of accommodation follows with the consent of the employee, but not in his interest.The Supreme Administrative Court's stated that employees satisfy their housing needs another place.Therefore, they do not receive benefits, the employer incur the costs 44 .

CONCLUSION
Taking into account the above that the value of employee fringe benefits could be revenue must be fulfill specific criteria.They were clearly indicated by the Constitutional Tribunal.Thus, not all benefits received from the employer are included in the income from the employment relationship.
Receiving a fringe benefit is not only a motivation problem for the employee but also a concrete financial benefit.From the tax point of view the concept of benefits raises many controversies and doubts.The lack of legal definition on the one hand creates the arbitrary interpretation of the rule.And on the other, it causes the taxpayer's anxiety.Because, the tax-payer is responsible for not paying taxes.Thus, it is exposed to the application of sanctions.
The analysis of the problem shows the inability to classify all fringe employee benefits.The reason for this is too wide and constantly increasing range.In addition, it is difficult to comprehensively identify all the elements and features of employee benefits.Of course, case law and doctrine fills the legal gaps.However, it should be remembered that they cannot create but only apply the law.The role of judicature leads to informal law-making.
The above considerations authorize the submission of several proposals de lege ferenda.It is extremely important to develop a legal definition fringe benefits in order to eliminate doubts and interpretational contradictions.It should be emphasized ever-increasing universality fringe employee benefits.Therefore, it is necessary to create such a tax law that the employee and the employer do not incur excessive tax burdens.And receiving fringe resulted in a specific and individualized benefit.In addition, due to the increasing popularity are expected to more highlight their problems.