WKR rules in 2026 explained: keep track
Pascal van Dalen
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TL;DR — In 30 seconds
Discretionary margin 2026: 2% on the first €400,000 wage bill + 1.18% on the excess. Unchanged compared to 2025.
A gift card to your employee falls within the discretionary margin — provided you designate it as final levy wage. Until your discretionary margin is used up, you pay zero tax.
Do you exceed the discretionary margin? Then you pay an 80% final levy on the excess.
Cash, travel expenses and training courses do not fall under the discretionary margin — they have their own route (targeted exemption or regular wages).
With a digital gift card, you maintain a single airtight administration: who received what, when, and how much discretionary margin you have left.
💡 Why Giffy is writing this
Giffy builds gift card infrastructure for businesses. We see daily how HR and Finance teams struggle with the WKR (Work-related costs scheme): not because the rules are impossible, but because there is a lack of overview. This guide lists the rules of 2026 — from financial integrity and an airtight administration, exactly as we apply it ourselves.
The Work-related costs scheme (WKR) sounds more complicated than it is. In essence, it is one simple question: how much can you give your employees tax-free, and how do you keep track of that? Below is the complete explanation for 2026 — including a practical calculation example and an overview of which gifts do and do not count.
First things first: what is the WKR again?
The Work-related costs scheme (WKR) regulates how you, as an employer, treat allowances, benefits in kind and gifts to your staff for tax purposes. Everything you give an employee on top of their regular salary — a Christmas hamper, a gift card, a company outing — is in principle taxable wage. The WKR gives you a discretionary margin: a budget within which you can give these types of things tax-free.
Are you within your discretionary margin? Then no one pays tax. Do you exceed it? Then you, as the employer, pay an 80% final tax levy on the amount exceeding the margin — not your employee.
How much discretionary margin do you have in 2026?
The percentages for 2026 have remained the same as in 2025:
2% on the first €400,000 of your total taxable wage bill
1.18% on everything above that
Nothing more, nothing less. The discretionary margin therefore scales with your wage bill.
Calculating WKR 2026: a concrete example
Suppose your company has a taxable wage bill of €600,000. Then you calculate:
2% × €400,000 = €8,000
1.18% × €200,000 (the excess) = €2,360
Total discretionary margin: €10,360
Within that €10,360, you can give tax-free gifts, cards and extras in 2026. Every euro above that costs you an 80% final tax levy. With a wage bill of €600,000, you therefore have room for hundreds of gift cards of €25 — without starting to pay a single penny in tax.
Want to calculate your own margin quickly? Take your total taxable wage bill. Is it under €400,000? Multiply by 2%. Is it above? Then €8,000 + 1.18% on the amount above €400,000.
Which gifts fall within the WKR discretionary margin in 2026?
This is where most confusion arises. Not everything you give counts against your discretionary margin — some items have their own tax route. Here is the overview:
What you give | Falls within discretionary margin? | Explanation |
|---|---|---|
Gift card (Christmas, anniversary, thank you) | ✅ Yes | Benefit in kind. Designate as final levy wage → tax-free until your margin is used up |
Christmas hamper | ✅ Yes | Classic discretionary margin item |
External staff party / outing | ✅ Yes | A party at the workplace itself is a nil valuation (does not count) |
Anniversary gift (above the exemption) | ✅ Yes | The portion above the targeted exemption falls within the discretionary margin |
Business travel expenses (≤ €0.23/km) | ❌ No | Targeted exemption — falls outside the discretionary margin |
Education / course | ❌ No | Targeted exemption |
Necessary laptop or phone | ❌ No | Necessity criterion — not taxable wage |
Small personal token of appreciation (flowers for illness, < €25, no cash or card) | ❌ No | Appreciation scheme — not taxable wage |
Cash or a bonus | ❌ No | This is regularly taxed wage, not a discretionary margin item |
The most important lesson: a gift card is one of the few ways to give your employees something of real value within the discretionary margin. Cash falls outside the scheme and is simply taxed. A card with freedom of choice gives the same freedom as cash, but in a tax-smart way.
Smart exceptions: how to keep more margin available
In addition to the discretionary margin, there are targeted exemptions and nil valuations. These fall outside your discretionary margin — and that is good news, because it keeps that margin available for gifts.
Targeted exemptions: business travel expenses, training costs, occupational health and safety facilities, meals during overtime. You can reimburse these tax-free without it costing you discretionary margin.
Nil valuations: workplace amenities — think of coffee, an office chair, company clothing with logo. Value: zero for the WKR.
Appreciation scheme: a small gift for a personal event (illness, birth) up to €25 including VAT — no cash, no card — is not considered taxable wage.
By using these routes consciously, you preserve your discretionary margin for what really matters: showing appreciation with a gift that your employee can spend themselves.
4 tips to keep a grip on your discretionary margin in 2026
Calculate your discretionary margin at the start of the year. Then you know exactly how much budget you have and can plan ahead for Christmas — the moment when most companies risk exceeding it.
Designate gift cards as final levy wage on time. Do this in your records at the time of distribution, not in hindsight. The designation must be finalised by the end of the calendar year at the latest.
Separate target-exempt costs. Travel expenses and training do not belong in your discretionary margin. Book them separately, and you will keep margin available.
Work with one airtight registration. The biggest WKR risk is not the rule, but the lack of overview. Who got what, when, and how much margin is left? One source of truth prevents surprises at the year-end settlement.
🔐 Giffy for employers
Giffy delivers digital gift cards specifically for business use: multi-brand freedom of choice for your employees, complete WKR reporting and an audit trail per distribution, branded for your business. You see at a single glance who got what — and how much discretionary margin you have left. → See how to order a corporate gift card
Why a gift card is a smart WKR choice
If you want to reward employees within the discretionary margin, a gift card is one of the most efficient ways to do so:
Freedom of choice — the recipient spends the value at the brand or shop of their choice. No unwanted gifts.
Tax-clear — one amount, one designation as final levy wage, one entry in your records.
Airtight chain — digitally traceable from publisher to recipient. Exactly what auditing accountants want to see.
Scalable — whether you reward 10 or 1,000 employees, the process remains the same.
Where cash is always taxed and a physical gift often does not hit the mark, a digital gift card combines appreciation with tax simplicity. Especially towards the end of the year, when Christmas hampers and year-end gifts quickly fill up your discretionary margin, grip on your records is the difference between a smooth closure and an additional tax assessment.
Planning your year-end? Instantly view options for a custom Christmas hamper proposal — including WKR reporting.
Conclusion
The WKR is not a moving target in 2026: 2% up to €400,000 wage bill, 1.18% above that. What you need is not tax training, but overview. Calculate your discretionary margin, know which gifts count and which have their own route, and register everything in one place. Do that, and the WKR turns from an annual headache into an instrument with which you can consciously and tax-free show appreciation.
Frequently Asked Questions
What is the discretionary margin of the WKR in 2026?
In 2026, the discretionary margin is 2% on the first €400,000 of the taxable wage bill, plus 1.18% on the amount above that. Within that margin, you can give tax-free allowances, benefits in kind and gifts to employees.
Can you give a gift card tax-free to an employee?
Yes. A gift card is a benefit in kind that you can designate as final levy wage. As long as you stay within your discretionary margin, you pay no tax on it. If you exceed the discretionary margin, an 80% final tax levy applies to the excess — at the expense of the employer, not the employee.
How do I calculate my WKR discretionary margin?
Take your total taxable wage bill. Multiply the first €400,000 by 2% and the amount above that by 1.18%. For a wage bill of €600,000, that is €8,000 + €2,360 = €10,360 discretionary margin.
Does a Christmas hamper count towards the discretionary margin?
Yes. A Christmas hamper is a benefit in kind that you designate as final levy wage and that falls within the discretionary margin. Christmas hampers and year-end gifts are often the largest expenses — plan ahead for this.
Does cash also fall within the discretionary margin?
No. Cash and regular bonuses are taxed wages and do not fall under the discretionary margin. If you want to show appreciation within the WKR, then a gift card or benefit in kind is the designated format.
What happens if I exceed the discretionary margin?
On the amount above your discretionary margin, you as the employer pay an 80% final tax levy. Your employee will not notice this — the levy is entirely at the expense of the employer.
Do travel expenses and training courses fall within the discretionary margin?
No. Business travel expenses (up to €0.23 per kilometre) and training costs are targeted exemptions. You can reimburse these tax-free without it costing you discretionary margin.
What is the difference between a targeted exemption and the discretionary margin?
The discretionary margin is a general budget for tax-free benefits in kind. Targeted exemptions (travel expenses, training, occupational health and safety) are separate from this and do not cost you discretionary margin. By separating them cleanly, you keep more margin available for gifts.
How do I keep my WKR records airtight?
Register per benefit in kind who received what, when, and for what amount, and track your remaining discretionary margin in real-time. A digital gift card platform with WKR reporting provides you with a single source of truth and an audit trail for your accountant.
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About the author
Giffy is the Dutch platform for digital gift cards with which businesses distribute value securely, quickly, and custom-branded — to clients, partners, and employees. We believe in financial integrity and a transparent chain: from
I am a passionate and commercial professional with over 25 years of experience in leading sales and marketing development teams, implementing go-to-market strategies, and driving revenue growth in the FinTech - AI industry.
