Fringe benefits: valuation, the 2026 threshold, cars, loans and housing

Luca is a sales engineer in Padua with two children. In 2026 his employer gives him €500 of fuel vouchers and refunds €900 of household utility bills. His colleague Andrea, who has no children, receives exactly the same. For Luca the €1,400 is not income; for Andrea all of it is. The difference lies in the fringe benefit threshold, and in how it works.

What fringe benefits are

Fringe benefits are the goods and services an employer provides on top of cash pay that do not fall within the welfare exclusions. A shopping voucher, a fuel card, private use of a company car, accommodation or a cheap loan are typical examples.

Under the general rule in paragraph 1 these values are income. Paragraph 3 of Article 51 explains how to measure them and sets a threshold below which they are left out. Paragraph 4 lays down standard formulas for three cases that would otherwise be hard to value: vehicles, loans and buildings.

Whether something is welfare or a fringe benefit depends on the rule, not on the object. Collective transport organised for all staff is welfare under letter d); a fuel voucher handed to one person is a fringe benefit. The same need can land on either side depending on how, and for whom, it is met.

How the value is measured

Paragraph 3 refers to the normal value defined in Article 9 of the TUIR, meaning the average price charged for goods and services of the same kind. The rule also applies to goods and services provided to the employee's spouse or family members, and to the right to obtain them from third parties.

Goods and services the company itself makes or trades are treated differently. Their value is the average price charged at the same stage of distribution at which they pass to the worker or, failing that, the employer's cost. A staff discount on company products is therefore measured against the price charged to customers.

The threshold: 258.23 euros in the text, 1,000 or 2,000 in 2026

In the text of Article 51 the threshold is 258.23 euros per tax year. The mechanism is all-or-nothing: if the total value of goods and services does not exceed the limit, it is not income; if it does, it is income in full. Tax falls on the whole year's value, not just on the excess.

For 2026 a higher threshold applies. The news item in which INPS presented its circular no. 6 of 2026 confirms an annual limit of 1,000 euros for this year, raised to 2,000 euros for employees with children. It covers all goods and services provided by the company, household utility refunds included.

The INPS item states the limits but does not restate how they operate. The mechanism written into paragraph 3 is still a threshold, and none of the sources read for this course points to a different one for 2026. For the employer the practical upshot is simple: keep a running total of every benefit, employee by employee.

The total covers the whole year and every item. A Christmas shopping voucher, a utility refund in spring and the use of a company car all add up. Crossing the threshold by a few euros in December pulls into income the benefits of earlier months too, which until then had been treated as excluded.

The employer, who withholds tax as the employee's tax agent, needs to know the employee's family situation to apply the right threshold. The INPS item refers to workers with children without spelling out here how that is declared: in practice the employer obtains the information from the employee before providing the benefits.

Company cars used privately

A car provided for work and private use alike is the most common fringe benefit and the heaviest. Paragraph 4, letter a) does not measure its actual value but applies a standard formula, in the text applicable to 2026 as last amended by Legislative Decree no. 148 of 7 August 2026.

The starting point is a notional 15,000 kilometres a year, multiplied by the running cost per kilometre in the national tables drawn up by ACI, the Italian automobile club, and published by 31 December for the following year. Fifty percent of the result is taken, net of any amounts the employee pays for the car, accessories and fittings included.

The percentage drops to 10 percent for fully electric battery vehicles and to 20 percent for plug-in hybrids. After 31 December of the fifth year following first registration, the values rise by 50 percent. Accessories and fittings not priced in the tables and not paid for by the worker add a further 5 percent.

Paragraph 4 states that these formulas apply «for the purposes of paragraph 3». The car's value therefore goes into the year's fringe benefit total and is set against the threshold. A combustion-engine car clears any threshold on its own; an electric car, at the value in the example, would leave room for other benefits.

The 2025 budget law had limited the differentiated percentages to newly registered vehicles provided under contracts signed from 1 January 2025.

The Gazzetta's update note records that Legislative Decree 148 of 2026 extends, from 2026, some of the new rules to vehicles under the transitional regimes too: for a car provided before 2025, check which rule applies.

Loans and housing

For loans to employees, letter b) takes 50 percent of the gap between interest worked out at the official reference rate and interest at the rate actually charged. For variable-rate loans the rate in force when each instalment falls due counts; for fixed-rate loans, the rate on the date the loan was granted.

The rule does not cover some loans: those signed before 1 January 1997, those lasting under twelve months granted under company agreements to staff on solidarity contracts or short-time working, and those to employees who are victims of usury or extortion, in the cases set by the laws the text cites.

For buildings let, lent or provided for use, letter c) takes the gap between the cadastral income plus all related costs, including utilities not borne by the occupant, and what the employee pays. If the employee is required to live in the accommodation, 30 percent of that gap is taken.

For buildings that need not be entered in the land register the formula changes: the benchmark is the rent set under controlled-rent rules or, failing that, the open-market rent, less whatever the employee pays for the use of the accommodation.

Planning the year's benefits

For a business, the threshold is a scheduling constraint more than an amount constraint. It pays to decide at the start of the year which benefits each category of staff will receive, estimate their total value and set aside some headroom for unplanned occasions such as an end-of-year voucher.

The choice between welfare and fringe benefits follows the same logic. An item covered by paragraph 2, such as refunding school fees for staff with children, does not eat into the fringe benefit threshold. Moving part of the budget there leaves room under the threshold for items that have nowhere else to go.

For employees the advice mirrors this: keep a note of benefits received and compare it with the payslip. If a December benefit pushes the total over the threshold, the year-end adjustment pulls earlier months' values into income too, and December or January take-home pay can come out lower than expected.

Which text for 2026, and afterwards

The consolidated text published by the Gazzetta Ufficiale already shows a newer version of Article 51 that merely records its repeal by Legislative Decree no. 117 of 19 June 2026. For 2026 the previous version, the one quoted in this course, still applies; for later years the same rules will need rereading in the new code.

For the employer the practical work stays the same: gather the values each year, check the threshold that applies to each employee, withhold tax and report the figures in the Certificazione Unica. For the employee, knowing the mechanism helps in reading the payslip and understanding why a December benefit can change take-home pay.