https // : How does Sodexo make money?

https // : How does Sodexo make money?

The Sodexo Meal Pass is dispatched in an inactive mode for security reasons. The card must be activated before usage which can be done by following some simple instructions mentioned in the welcome kit that you will receive along with the card.

    • Activate your card online by visiting the card activation portal
      • Enter your official registered email address/ mobile number
      • Enter the 12-digit card reference number (mentioned on the Welcome Letter)
      • Click on ‘Get Activation Code’
      • Provide Officially Valid Document* details to complete KYC
      • Enter activation code (received on email/ SMS)
      • Complete OTP-based mobile number verification
      • Click on ‘Activate Card’

Officially Valid documents include Passport, Driving License, Voter ID, PAN Card. In case of PAN card, additional Proof of address documents like Bank Statement, Electricity Bill, Landline bill (not mobile), Leave & License Agreement/Rent Agreement of house are to be provided.

You can save up to ₹22,000 in taxes and exclusive deals every year with Sodexo Meal Card. You can calculate the amount you can save with Sodexo Meal Card at

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How does Sodexo make money?

No a big No! Sodexo doesn’t rely mainly on people to be ignorant and not use their Sodexo before the expiry date or to pay more than the thing is actually worth for PROFIT!

Sodexo charges 2% commission to employers when they book Sodexo coupons for their employees. When you go and purchase your grocery from lets say Big Bazaar from these Sodexo coupons. Sodexo charges 2% to Big Bazaar as well when they want to encash these Sodexo coopons. So sodexo earns a lot of profit through this conversion of Sodexo coupons to INR and vice versa. This is very similar to Banks earning through their POS swipe machines, they charge 1.8% as transaction fees.


Why would people go for Sodexo coupons instead of hard cash money or credit card – is a totally different story for tax saving purpose. You can read below details on how does it provides tax saving to employees.

There are different kind of Sodexo coupons available. But mainly Sodexo Meal Pass coupons are given by employer to its employees monthly for tax saving purpose.

The value of the coupons varies from employer to employer. It is observed that many of such employers as well as their employees are under the impression that sodexo coupons are fully exempt and are not taxable as perquisites irrespective of the amount. This is not correct interpretation of law.

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Rule (3)(7)(iii) dealing with such perquisites is reproduced here under for discussion.

‘The value of free food and non-alcoholic beverages provided by the employer to an employee shall be the amount of expenditure incurred by such employer. The amount so determined shall be reduced by the amount, if any, paid or recovered from the employee for such benefit or amenity:

Provided that nothing contained in this clause shall apply to free food and non-alcoholic beverages provided by such employer during working hours at office or business premises or through paid vouchers which are not transferable and usable only at eating joints, to the extent the value thereof in either case does not exceed fifty rupees per meal or to tea or snacks provided during working hours or to free food and non-alcoholic beverages during working hours provided in a remote area or an off-shore installation.’

As mentioned in the rule, the valuation of this perquisite is done taking the gross cost to the employer as reduced by an amount collected from the employee in this regards, i.e. at the net cost to employer. This perquisite is tax free only to the extent of Rs. 50 (max) per meal during the working hours. It is very important to understand that one has to consider the working hours of the organization to calculate the tax-free amount of this perquisite.

Hence : 2 meals a day = 2*50 = 100 / day *30 days = 3,000 INR / month

Sodexo coupons are totally tax free to employees.

This provides a huge tax benefit to employees – let’s say an employee is in 30% tax bracket (CTC is higher than 10 lacs). Then every month one could save 900 INR / month in Income Tax (for taking 3000 Sodexo). This can be thought as 12*900 = 10,800 INR tax saving / year.

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