Cinnamon Bun Day and Lucia – two examples of days when coffee breaks are common in workplaces across the country. But when is the coffee break deductible and not taxable for the employees?
Rules regarding coffee at work
Coffee at the workplace is considered a staff welfare benefit intended to create a pleasant work environment. This means that as an employer, you can offer your employees refreshments or simple snacks tax-free if these criteria are met:
- The benefit has a low value.
- The benefit is considered simple.
- The benefit is offered to all employees regardless of employment form who are active in their service at the workplace.
According to the Swedish Tax Agency, simple snacks include coffee, tea, sandwiches, fruits or a bun. This means that both the cinnamon bun and the saffron bun fall within the scope of deductible snacks for you as an employer and are tax-free for the employees. A meal such as lunch or dinner is not considered a staff welfare benefit and must therefore be taxed as a benefit.
No tax-free coffee on business trips
According to the staff welfare benefit, coffee for employees must be provided at the physical workplace to be tax-free. This means that staff present at the workplace during Cinnamon Bun Day or Lucia can enjoy their bun without being taxed as a benefit. However, if an employee is on a business trip at the time and makes an expense for their bun, they will be taxed as a benefit. Free coffee during business trips is not a tax-free staff welfare benefit according to the Swedish Tax Agency since the employee is not at the workplace.
