GUWonder

Have you considered a change of country of residence for tax purposes before cashing out?

There are some European professional services types working out of some no/low income tax jurisdictions in the GCC area who are doing so for the benefit of their European-based affiliates' bosses'/owners' retirement plans after relocation. I doubt airline points are the big consideration in such regard.

Im a new user

It's not something unknown. The Swedish tax authority describes how it works. On the other hand, the Norwegian tax authority explains how you determine the value of the benefit whereas the Swedish tax authority only talks about the value, potentially leaving more room for interpretation (read: it's unpredictable how much tax you will have to pay).

I get the impression that Norway only is changing how you report this, not how much tax you have to pay.

Im a new user

Then you will have to inform your former employer, I think. I don't know what you'd do if the employer has since gone bankrupt.

GUWonder

I do wonder what proportion of the traveling people working for Skatteverket or even maybe the Admin Courts handling tax cases are in compliance with the requirement to report the discount/rebate currency acquired from work travel and used for non-work purposes. And I do wonder how they value the hotel rebate currency redemption value, especially when the hotels' billable rate for award nights may be well below the rates available via the major GDS.

For example, some hotels charge a flat nightly rate of c. 675 SEK for an award night even as the GDS rate for the night for the same kind of room would be 3-5 times higher than 675 SEK. What's the value of the points redeemed for such a night? Some may claim it's even less than the 675 SEK amount since the points can be bought for perhaps as little as 600 SEK.

GUWonder

Contact the bankruptcy administrator/trustee for the liquidated company?

But even if the former employer is not bankrupt, what if the employer has a restraining order against contact or communication by the former employee?

Im a new user

Here are two articles from the Swedish press published shortly before last year's parliamentary election:

• One Moderate Party MP upgraded tickets for her family using points earned through her work.
• One Social Democratic Party MP refuses to tell what he has done with his Eurobonus points.

GUWonder

RoyalSwazi

GUWonder

fassy

Im a new user

I'd imagine that most of those people just go to work at their local tax office or court. Probably they don't get a lot of points from work-related travel. Lawyers maybe have to travel a bit if they have to go to courts in different parts of the country, although I suspect that many people use a local lawyer.

highupinthesky

I understand that, but what is the value of the benefit if I book a trip using points? The amount of points required are the same no matter when I book the trip, but the price of the trip goes up the closer we get to the departure. Further with my SAS Mastercard status, I pay the same amount of points whether I fly M or C. How are the authorities going to check what I report is correct?

Im a new user

The authorities have found themselves an easy solution to this: it's your responsibility to report the correct value, but it is at the same time impossible for you to determine this value. This is really something which needs to be taken to court for clarification.The authorities may ask you to provide more information to prove that what you have declared is correct. In Sweden, you are supposed to keep the necessary documents for 10 years (statute of limitations for tax fraud). It's probably some similar period of time in Norway. I'd imagine that this includes booking confirmations, redemption statements and evidence that it was or wasn't a business trip. I think that the 10-year period starts when you redeem your points, not when you earn then, so documents about accruals would need to be kept for 10 years from redemption.

Often1

These are all the same issues raised the last time the IRS and then Congress started saber-rattling about roughly the same issue 15+ years ago in the US. In the end, the whole effort fell apart over valuation and administrative burden issues and went away.

If the scheme ever came into force, as here, it would have created a generation of tax cheats and likely cost much more to administer than it would generate in revenue.

Im a new user

Bonus points come with odd restrictions. If you use cash, then you can take either the 8 AM FR flight or the 10 AM SK flight, but if you use Eurobonus points, then you have to take the SK flight. Has there been any discussion on how this restriction affects the value of the benefit?