The payment of the “Macron” bonus in 2021/2022
The exceptional purchasing power bonus, also called “Macron” bonus has been renewed in 2021 and can be paid until March 31st, 2022. It allows employers to pay a bonus exempt from income tax and social contributions to employees whose salary does not exceed a certain threshold.
Who are the eligible employees?
This bonus can be paid to any employee, (including employees on fixed term contracts) whose total remuneration for the last 12 months preceding the payment of the bonus is less than 3 times the legal minimum salary per year (“SMIC”), i.e., is less than € 57,219.
Because this bonus is solely targeted to employees whose salary is beneath the threshold any amount paid as a “Macron bonus” to an employee who has received a salary equal or higher than € 57,219 during the 12 past months will be fully subject to social contributions and income tax.
This reference salary of € 57,219 is to be prorated according to the working time provided for in the employment contract of the employee and depending on the employee’s length of presence over the year.
What are the of exemption?
The “Macron” bonus is exempt from income tax and social contributions within the limit of € 1,000 per employee.
However, this bonus can be exempt up to € 2,000 in companies:
– employing less than 50 employees,
– or having a profit-sharing agreement,
– or employing certain categories of employees who, due to the nature of their tasks which cannot be performed remotely, have directly contributed to the continuity of economic activity and to the maintenance of social cohesion during the periods of health emergency.
If a bonus higher than € 1,000 or € 2,000, depending on the case, is paid, only the amount paid in excess of these caps will be subject to income tax and social contributions.
How to implement this bonus?
The payment of the “Macron” bonus and its conditions can determined either by a company collective agreement or by a unilateral declaration of the employer.
The amount of the bonus can be adjusted according to objective criteria such as the level of salary, the employees’ classification, the length of actual presence or the working time provided for in the employment contracts (these conditions being assessed over the 12 months preceding the payment of the bonus).
The “Macron” bonus cannot replace a salary increase or any other bonus to which an employee would normally be eligible.