Sample Executive Perquisites Policy

Sample_Documents

DISCLAIMER: This is a sample template provided for informational purposes only. It does not constitute legal, tax, or financial advice. Organizations should consult their own legal and tax advisors and tailor this document to reflect their specific business needs, geographies, and applicable laws.

Executive Perquisites Policy

Document Information

Field	Value
Document Type	Executive Perquisites Policy
Category	Perquisites & Programs
Company	<Company Name>
Policy Owner	<Policy Owner Title/Department>
Version	<Version Number>
Effective Date	<Effective Date, e.g., <Date>>
Last Review Date	<Date>
Next Scheduled Review	<Date> or Annual in <Month>
Approving Authority	<Committee or Executive Title>
Geographic Scope	<Country> and any additional jurisdictions as designated by <Company Name>
Contact	<Contact Name>, <Title>, <Email>, <Phone>

Change History

Version	Date	Description of Changes	Author	Approver
<v1.0>	<Date>	Initial release	<Name>	<Name/Committee>
<v1.1>	<Date>	Updated perquisite caps and clarified tax gross-up criteria	<Name>	<Name/Committee>

Purpose and Objectives

• Establish a clear, equitable, and compliant framework for executive perquisites that supports talent attraction, retention, productivity, and well-being.
• Provide guardrails for eligible offerings, annual limits, approval thresholds, tax and accounting treatment, and documentation requirements.
• Ensure alignment with <Company Name>’s business strategy, culture, and governance standards while managing cost and reputational risk.

Scope and Applicability

• In Scope
  • Design, eligibility, funding, administration, and taxation of executive perquisites for roles at or above <Executive Level/Grade> (e.g., <E1–E5>).
  • Coverage of employees on international assignment when designated as eligible by <Company Name>.
  • Global parameters and local adaptations required to comply with regulations in <Country> and other jurisdictions.
• Out of Scope
  • Base pay, annual and long-term incentives, and core benefits (e.g., health, retirement) governed by separate policies.
  • Relocation benefits covered under the Mobility policy unless explicitly referenced herein as executive-only enhancements.
  • Board of Directors perquisites governed by Board policies.
  • Non-executive perks and recognition programs covered under Employee Experience or Local HR policies.

Policy Statement and Guiding Principles

• Business Need and Market Relevance perquisites must support legitimate business objectives such as wellness, security, and productivity, and be aligned with market practices for peer companies in <Industry> and <Country>.
• Equity and Transparency offerings and limits are consistently applied by level, with documented exceptions only.
• Cost Stewardship annual caps and approval thresholds manage spend while preserving flexibility for critical needs.
• Compliance adhere to applicable tax, labor, securities, privacy, and anti-bribery laws in all jurisdictions where <Company Name> operates.
• Privacy and Dignity handle personal data discretely, minimize required personal information, and restrict access to need-to-know roles only.

Eligibility and Coverage

Eligible Populations

• Executive officers and roles in grades <E1–E5> or as designated by <Company Name>.
• Newly hired executives become eligible on the later of <Date> or their start date unless an offer letter specifies otherwise.
• Executives on approved leaves remain eligible subject to local law and plan eligibility rules, with prorations as noted below.

Waiting Periods and Proration

• Eligibility may be prorated based on hire date or promotion date within the fiscal year at <Percentage> of the annual cap per full month of eligibility.
• Upon termination, perquisite access ends on the termination date unless statutory rules or written agreements specify otherwise.
• Retirees and severed executives may have limited continuation of certain perquisites for up to <Number> months when approved by <Approving Authority>.

Perquisite Portfolio

Overview of Covered Perquisites

• Financial Counseling and Tax Preparation
• Executive Physical and Preventive Care
• Security and Risk Mitigation
• Supplemental Communication and Connectivity
• Professional Club Memberships
• Vehicle Allowance or Car Service
• Spousal or Companion Travel
• Relocation Enhancements for Executives
• Home Office Furnishings Beyond Standard
• Charitable Donation Facilitation Fees
• Education and Coaching
• Other Business-Justified Perquisites approved by <Approving Authority>

Annual Perquisite Caps and Aggregation Rules

• Each eligible executive is subject to an annual aggregate perquisite cap of <Amount> or <Percentage> of base salary, whichever is lower, unless otherwise approved.
• Category-specific caps apply as listed in the Perquisite Summary table. Aggregate caps do not override statutory limits or local tax rules.
• Reimbursements and direct vendor payments apply toward caps in the fiscal year the cost is incurred.
• Gross-ups, if provided, do not reduce the perquisite cap unless noted.

Perquisite Summary Table

Perquisite	Eligibility	Annual Category Cap	Tax Treatment	Notes
Financial Counseling and Tax Preparation	<E2 and above>	<Amount>	Typically taxable to the employee in <Country> unless business-required	Vendors include <Vendor Name>; limited to services for the executive
Executive Physical and Preventive Care	<E1 and above>	<Amount>	Taxable or non-taxable depending on <Country> medical benefit rules	Comprehensive executive exam at <Provider Name>
Security and Risk Mitigation	Designated executives per risk assessment	<Amount>	Company convenience doctrine may apply; consult local tax	Includes home security assessment and monitoring
Professional Club Memberships	<E3 and above>	<Amount>	Generally taxable unless demonstrably business-use	Requires business-justification memo
Vehicle Allowance or Car Service	<E2 and above>	<Amount>	Taxable personal use; company car valuation rules apply	Mileage logs required for mixed use
Spousal or Companion Travel	<E1 and above> with business purpose	<Amount> or case-by-case	Typically taxable unless bona fide business purpose	Pre-approval required per trip
Home Office Furnishings Beyond Standard	<E1 and above>	<Amount>	Taxable in many jurisdictions unless required for work	Separate from standard IT kit
Education and Coaching	<E1 and above>	<Amount>	May be non-taxable if job-related; varies by <Country>	Executive coaching at <Vendor Name>

Financial Counseling and Tax Preparation

• Purpose is to support complex compensation and equity planning and reduce administrative burden.
• Covered services include annual tax preparation, executive financial planning sessions, and equity liquidation strategy consultations.
• Caps: up to <Amount> per year for <E2–E5>, up to <Amount> for <E1>.
• Vendor model: Company-paid retainer with <Vendor Name> or reimbursement to employee with itemized invoice.
• Documentation: engagement letter, invoice, and certification that services applied only to the executive and not to unrelated family members.
• Tax: generally taxable in <Country> unless the service is required for business reasons; evaluate gross-up per criteria below.

Executive Physical and Preventive Care

• Annual comprehensive physical at <Provider Name> including screenings appropriate to age and gender guidelines.
• Caps: up to <Amount> per year for exams and medically recommended follow-ups not covered by insurance.
• Spouse or domestic partner coverage allowed for <Percentage> of executives at levels <E1–E2> subject to cap and local law.
• Scheduling and privacy: employees schedule directly with provider; results shared only with the employee, not with <Company Name>.
• Tax: treatment depends on <Country> health benefit rules; consult local payroll.

Security and Risk Mitigation

• Offer home security assessments, monitoring, and executive travel security for roles designated by a documented risk assessment performed by <Security Team>.
• Caps: <Amount> initial installation plus <Amount> annual monitoring.
• Company convenience doctrine may justify favorable tax treatment in certain jurisdictions; document the security need and retain the assessment.
• Procurement: use preferred vendors screened by <Procurement> and <Legal>.

Supplemental Communication and Connectivity

• Coverage for enhanced mobile plans, hotspot devices, and home internet upgrades required for 24x7 availability.
• Caps: <Amount> per month or <Amount> annually, net of standard corporate plan.
• Tax: personal use may be taxable in <Country>; maintain reasonable use statement.

Professional Club Memberships

• Criteria: memberships must have a clear business purpose such as client development or industry engagement.
• Caps: <Amount> initiation fee and <Amount> annual dues; personal club charges are not covered.
• Required documentation: business justification memo approved by <Approving Authority> and annual attestation of business use.
• Tax: generally taxable unless local law permits exclusion with business substantiation.

Vehicle Allowance or Car Service

• Provide either a monthly vehicle allowance of <Amount> or access to a car service for business travel where safety or efficiency warrants.
• Personal use is taxable; maintain mileage logs for mixed-use vehicles.
• Insurance and licensing compliance required; employees must meet fleet safety standards.

Spousal or Companion Travel

• Allowed when the spouse or companion’s presence serves a bona fide business purpose and is pre-approved.
• Caps: <Amount> per trip or full fare as authorized; coach vs. premium cabin aligned with <Company Name> travel policy.
• Tax: typically taxable if no bona fide business purpose; determine imputed income and gross-up decisions per this policy.

Relocation Enhancements for Executives

• Enhancements beyond standard mobility policy may include home sale assistance, temporary housing extensions, and destination services.
• Caps: incremental executive enhancements not to exceed <Amount> without <Approving Authority> approval.
• Tax: follow mobility policy and local tax rules; some benefits may be taxable in <Country> following recent law changes.

Home Office Furnishings Beyond Standard

• Provide ergonomic chair, desk, lighting, and accessories beyond standard IT kit where business need is established.
• Caps: <Amount> per rolling <Number>-year period; items remain company property unless otherwise required by law.
• Return or purchase-at-fair-value terms apply on separation, subject to local law.

Education and Coaching

• Executive coaching, leadership assessments, and targeted course fees directly related to current role or succession plan.
• Caps: <Amount> annually; coaching provider must be on <Approved Vendor List>.
• Tax: may be non-taxable if job-related; confirm local rules.

Tax, Legal, and Accounting Considerations

Taxation Principles and Gross-Up Criteria

• Imputed Income perquisites that provide personal benefit are generally taxable wage income in <Country> unless a statutory exclusion applies.
• Withholding and Reporting payroll must withhold income and employment taxes and report perquisites via <Country Reporting Form> or local equivalent in the period provided.
• Gross-Up <Company Name> may gross-up taxes for select perquisites to improve net value and competitive positioning.
  • Gross-up is allowed for executive physicals, security, and communication connectivity when deemed business-necessary.
  • Gross-up is not allowed for club memberships, vehicle personal use, or spousal travel without bona fide business purpose.
  • Standard gross-up rate: <Percentage> to approximate combined tax rate in <Country>; true-up may occur at year-end.
• International Assignments coordinate with tax equalization or protection policies; avoid duplicate benefits.

Regulatory References and Disclaimers

• Laws vary by jurisdiction, including but not limited to tax deductibility, benefit valuation rules, and payroll reporting.
• In <Country>, sections analogous to 409A, 274, 162(m), 280G, or their local equivalents may influence plan design and reporting.
• Nothing in this policy creates a contract or guarantee of employment or specific benefits. <Company Name> reserves the right to modify or terminate perquisites at any time, subject to applicable law and any written agreements.

Accounting and Financial Reporting

• Perquisite costs must be recorded in designated cost centers with appropriate project or employee tags.
• Accrue expenses in the period incurred; allocate to business units per cost-sharing rules set by <Finance>.
• Disclose executive perquisites as required by securities regulations in <Country> or other relevant jurisdictions.

Roles and Responsibilities

Policy Owner (Total Rewards)

• Design and maintain policy, market benchmarking, and annual cap recommendations.
• Provide guidance on eligibility, interpretation, and exceptions.
• Partner with <Payroll>, <Legal>, <Finance>, <Security>, and <Procurement> on implementation.

Payroll and HR Operations

• Administer reimbursements, taxable benefit processing, and gross-ups.
• Maintain employee-level ledgers for cap monitoring.
• Ensure timely and accurate payroll reporting in all jurisdictions.

Finance and Accounting

• Establish GL coding, accrual processes, and financial controls.
• Review cost reporting and provide periodic spend analyses.

Legal and Compliance

• Advise on regulatory compliance and disclosures.
• Review vendor contracts and data protection terms.

Security and IT

• Conduct risk assessments for security-related perquisites.
• Approve technology standards and ensure secure provisioning.

Business Leaders and Approvers

• Validate business need and ensure prudent use of perquisites.
• Approve exceptions within authority limits and ensure documentation.

Executives (Participants)

• Use perquisites responsibly and submit timely, truthful documentation.
• Maintain mileage logs, business-purpose statements, and attestations as required.

Implementation Guidelines

Vendor Selection and Management

• Use preferred vendors vetted by <Procurement> and <Legal> for confidentiality, insurance, data privacy, and service quality.
• Contracts must include data processing addendum, breach notification timelines, and service-level agreements.
• Evaluate vendors at least every <Number> years for competitiveness and performance.

Enrollment and Provisioning

• Newly eligible executives receive a welcome package within <Number> days outlining offerings, caps, and contacts.
• For company-paid perquisites, provisioning occurs after receipt of signed acknowledgments and any required compliance training.
• For reimbursement-based perquisites, executives register in <Expense System Name> with appropriate policy code.

Reimbursement Workflow

1. Executive incurs an eligible expense within policy caps.
2. Executive submits an expense in <Expense System Name> with itemized receipt and business-purpose statement.
3. Manager or designated approver reviews for business need and budget.
4. HR Operations and Payroll review for policy compliance and tax treatment.
5. Finance codes expense and processes payment in the normal cycle.
6. Payroll calculates imputed income and gross-up per criteria and adds to the next payroll.

Documentation Requirements

• Itemized receipts showing vendor, date, description, and amount.
• Business-purpose statement when required (e.g., club, travel).
• Approval evidence for exceptions or spousal travel.
• Security assessment reports retained by <Security Team>.
• Annual attestation of business use where applicable.

Cap Monitoring and Controls

• Total Rewards maintains a quarterly report of perquisite utilization by executive against caps.
• System controls in <Expense System Name> reject submissions exceeding category or aggregate caps absent exception approval.
• Exception logs maintained for audit with fields for date, rationale, and approver.

Data Privacy and Confidentiality

• Collect only necessary data; store in systems approved by <IT> with role-based access.
• Health information from executive physicals is never stored by <Company Name>, only appointment confirmations for payment.
• Comply with <Country> privacy laws and cross-border data transfer requirements.

Record Retention

• Retain perquisite records for at least <Number> years or longer where required by local law.
• Retain approvals and attestation documentation for audit trails.

Governance, Caps, and Exceptions

Annual Budgeting and Market Review

• Total Rewards performs a market review each <Month/Year> using data from <Survey Source> and recommends caps by level.
• Finance sets an annual perquisite budget of <Amount> for the executive population, with quarterly reviews of spend.

Exceptions and Authority Levels

• Exceptions allowed for strategic business needs, compliance reasons, or security.
• Authority thresholds:
  • Line Manager up to <Amount> above cap per incident.
  • Business Unit Leader up to <Amount> above cap per fiscal year.
  • CHRO or <Committee Name> for exceptions exceeding <Amount> or policy deviations.
• All exceptions require documented rationale and sunset date.

Audits and Risk Management

• Internal Audit conducts periodic reviews, at least every <Number> years, of perquisite spend, tax treatment, and approvals.
• Identified gaps result in corrective action plans with owners and due dates.

Review and Approval Process

Policy Review Cycle

• Policy reviewed at least annually or upon material legal or market changes.
• Proposed changes drafted by Total Rewards, consulted with <Legal>, <Finance>, and <Payroll>.

Approval Workflow

1. Total Rewards drafts revisions and impact assessment.
2. Stakeholders review and comment within <Number> business days.
3. Total Rewards finalizes draft and submits to <Approving Authority>.
4. <Approving Authority> approves or requests changes within <Number> business days.
5. Upon approval, Policy Owner publishes the updated version and communicates effective date.

Effective Date and Transition Rules

• Changes apply prospectively from the stated effective date.
• In-flight reimbursements submitted within <Number> days of the effective date follow the prior policy, unless expressly stated.

Metrics and Reporting

Key Performance Indicators

• Utilization rate by perquisite category and executive level.
• Spend versus budget and variance drivers.
• Tax gross-up cost as a percentage of total perquisite spend.
• Employee satisfaction with executive physicals, coaching, and connectivity services.
• Audit findings and remediation timeliness.

Reporting Cadence

• Monthly operational dashboards to HR Operations and Finance.
• Quarterly executive summary to <Committee Name> including trends and recommendations.
• Annual market competitiveness report with proposed cap adjustments.

Frequently Asked Scenarios and Decisions

Scenario 1: Executive Physical with Add-On Testing

• If medically recommended by the provider, covered up to category cap; otherwise treated as elective and not covered.
• Tax treatment depends on local law; if taxable, consider gross-up per criteria.

Scenario 2: Club Membership Primarily for Networking

• Allowed if a business plan describes expected client development; annual attestation required.
• Taxable in most jurisdictions; no gross-up.

Scenario 3: Security Upgrade Following Elevated Risk

• Allowed with security assessment; installation and monitoring within cap.
• Potentially eligible for favorable tax treatment where company convenience is established and documented.

Scenario 4: Spousal Travel for Award Ceremony

• If spouse has no bona fide business purpose, cost is taxable; gross-up generally not provided unless approved as an exception.

Glossary of Terms and Definitions

Aggregate Cap

• The maximum annual company-funded amount available across all perquisites.

Bona Fide Business Purpose

• A legitimate, documented business need that justifies the perquisite or spousal participation.

Gross-Up

• Additional compensation paid to offset employee taxes on a taxable perquisite, calculated using a standard or individualized tax rate.

Imputed Income

• The value of a non-cash benefit treated as taxable compensation to the employee.

Perquisite (Perk)

• A non-cash or cash-like benefit provided in addition to base pay and incentive compensation, often to address unique executive needs.

Policy Owner

• The function accountable for the design, maintenance, and interpretation of this policy.

Risk Assessment

• A formal evaluation of personal and business risks informing security-related perquisites.

Appendices

Appendix A: Example Annual Caps by Level

Level	Aggregate Annual Cap	Notes
<E1>	<Amount>	Senior-most executives; may access full portfolio
<E2>	<Amount>	Standard executive caps
<E3>	<Amount>	Reduced caps with fewer categories eligible

Appendix B: Required Approvals by Category

Perquisite	Pre-Approval Required	Exception Authority
Club Memberships	Yes	<Business Unit Leader> up to <Amount>; <Committee Name> above
Spousal Travel	Yes per trip	<CHRO> or <Committee Name>
Security	Yes with risk assessment	<Security Lead> and <Legal>
Executive Physical	No if within cap	<Total Rewards> for exceptions

Communication to Executives and Managers

Purpose of This Communication

This message provides an overview of <Company Name>’s Executive Perquisites Program so you can understand what is available, how to access it, and where to go for help. It summarizes the policy in everyday terms and highlights what you need to do to make the most of your benefits.

What You Can Expect

As an executive at <Company Name>, you have access to a curated set of services designed to help you stay healthy, secure, and effective. Highlights include:

• An annual executive physical at <Provider Name> with comprehensive screenings and concierge scheduling.
• Professional financial counseling to help you manage equity, taxes, and long-term planning.
• Security support, including home security assessments and travel advisory services when your role requires it.
• Enhanced connectivity for always-on work, including supplemental mobile and home internet options.
• Optional professional club memberships for client engagement, with a clear business rationale.

Each benefit has an annual dollar limit and may have additional rules. Some items are taxable based on local law. Where allowed, <Company Name> may gross-up certain taxes so your out-of-pocket is minimized.

How to Get Started

1. Review your welcome email and the Executive Perquisites overview in <Intranet Site Name>.
2. If you want to use the executive physical benefit, contact <Provider Name> directly to schedule. You do not need to share medical results with <Company Name>.
3. For financial counseling, enroll with <Vendor Name> using your company email. You will see the annual cap in the portal.
4. For reimbursements, submit expenses in <Expense System Name> under policy code <Code> with itemized receipts and, if needed, a brief business-purpose note.
5. If you believe you need security support or spousal travel approval, contact <Security Team Email> or <Total Rewards Contact> before making arrangements.

Taxes and Paycheck Impact

Some benefits are treated as taxable income. When that happens, you may see an amount added to your taxable wages and a corresponding tax withholding. In certain cases, <Company Name> provides a tax gross-up to offset the impact. You will see any gross-up as a separate line item on your pay statement. If you have questions about personal taxes, please speak with your tax advisor or use the financial counseling service.

Tips for a Smooth Experience

• Plan ahead. Schedule your executive physical early in the calendar year.
• Keep receipts and confirmations. Submit expenses within <Number> days of purchase.
• Use preferred vendors. They are pre-vetted for privacy and service quality.
• Ask before you spend. For anything unusual or time-sensitive, email <Total Rewards Contact> to confirm eligibility.
• Be mindful of caps. The system tracks your usage, but it helps to know your remaining balance.

Where to Get Help

• Policy questions: <Total Rewards Contact> at <Email> or <Phone>.
• Expense submissions and reimbursements: <HR Operations Contact> at <Email>.
• Security support: <Security Team> at <Email>.
• Vendor services: <Vendor Name> portals linked on the intranet.

Final Notes

This communication is a summary. The full policy contains the details, including eligibility, limits, tax treatment, and approvals. If there is any difference between this summary and the policy, the policy controls. <Company Name> may update offerings and limits from time to time to reflect business needs and legal requirements.

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Document Information:

• Document Type: Executive Perquisites Policy
• Category: Perquisites & Programs
• Generated: August 28, 2025
• Status: Sample Template
• Next Review: <Insert Review Date>

Usage Instructions:

1. Replace all text in angle brackets < > with your company-specific information
2. Review all sections for applicability to your organization
3. Customize content to reflect your company's policies and local regulations
4. Have legal and HR leadership review before implementation
5. Update document header with your company's version control information
6. At bottom of the document you find a short example on how the content could be communicated to end-users, for instance employees.

This sample document is provided for reference only and should be customized to meet your organization's specific needs and local legal requirements.