Are my Redeemed Points Taxable?

Answers vary depending on the country's payroll taxation.

You can redeem earned JobPts for eGiftCard, Merchandise Item, Custom Award, Donation, or a Virtual Card.

Some countries levy on these benefits for payroll tax purposes and must be deducted by the employer when processing payroll. Certain countries tax all items, others have thresholds to be met before taxation, and some do not tax.

For example in the US, cash awards to employees are always taxable. Generally, the value of an award or prize given by an employer is taxable to an employee as wages, includable on Form W-2, and subject to federal income tax withholding, Social Security and Medicare. If the employer pays the employee’s share of taxes on an award, the amount of taxes paid are additional wages to the employee and are subject to all payroll taxes. For information on calculating the tax on employee taxes paid by the employer, see Publication 15-A, Rev. Rul. 86-14

The table below outlines the tax treatment per country. For specific questions and practices related to payroll in your country, please contact the responsible person for the local payroll.

Country	Taxable Benefit	Description
Australia	No, unless the threshold is exceeded	Note: If the total fringe benefits received (from April 1 to March 31) exceeds AUD 2,000, it will be captured as “Reportable Fringe Benefits Amount (RFBA)” in the employee’s Payment Summary (PAYG).
Botswana	Yes	Cash, gift vouchers, and merchandise are taxable.
China	Yes	Any reward payments (Cash or non-Cash) from company to individual are taxable.
Ghana	Yes	Cash, gift vouchers, and merchandise are taxable.
Hong Kong	Yes	Any reward payments related to employment (Cash or non-Cash) from company to individual are taxable.
India	No, unless the threshold is exceeded	Cash, gift vouchers, merchandise, and charitable donations up to INR 5000/- in a financial year (April to March) are tax-free. Must provide donation receipt to claim a tax rebate.
Indonesia	Yes	Any form of rewards received is subject to the Personal Income Tax (PPh21).
Ireland	Yes	Notional pay, benefit-in-kind (BIK), fringe benefits, or perks are benefits with monetary value, so they must be treated as taxable income.
Malaysia	Yes	All perquisites whether in money or otherwise, received by an employee in respect of having or exercising the employment are treated as gross income and are taxable on the employee. The annual exception limit is RM2,000.
Nigeria	Yes	Cash, gift vouchers, and merchandise are taxable.
Pakistan	Yes	Cash, gift vouchers, merchandise, and charitable donations are taxable. Must provide donation receipt to claim a tax rebate.
Poland	Yes	For Poland, it shall be treated as benefit-in-kind (BIK), fully taxable but not deducted from Total Net Pay. It will only act as Income Tax and Social Premium Calculation only.
Russia	If applicable	Payroll in Russia is done separately by local accountants, they will calculate any tax applicable.
Singapore	No, unless the threshold is exceeded	If the gift (either cash / non-cash) exceeds SGD 200, the full value is taxable. Otherwise, it is exempted from tax.
South Africa	Yes	Cash, gift vouchers, and merchandise are taxable.
Sri Lanka	Yes	Cash, gift vouchers, and merchandise are taxable; charitable donations are tax-free.
UAE - Dubai	No	No taxation in this country.
United Kingdom	Yes	Taxable in-kind; handled via p11d tax forms.
United States	Yes	eGift cards, merchandise, and products are treated as Imputed Earnings. Any JobPts redemptions for charitable items are not taxable. The imputed earnings amount is included in Gross Earnings to calculate the taxable amount. The imputed earnings are not included to calculate the Total Net Pay. Taxable redemptions are subject to FICA Tax which includes FIT Withheld, Medicare Employee Withheld, Social Security Employee Withheld, and SIT Withheld.
Zambia	Yes	Cash, gift vouchers, and merchandise are taxable.

DISCLAIMER & REFERENCES:

The information contained herein is not legal or tax advice and is not intended to be used, and cannot be used, for purposes of avoiding tax penalties or tax. The information contained herein is general in nature and contains the opinions and conclusions of Semos Cloud only. We assume no obligation or responsibility to inform the reader of any changes in tax laws or other factors that could affect information contained herein. Before making any decision based on this information you should consult with the appropriate legal or tax advisor.

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