Benefit In Kind
Benefits-in-kind, such as private use of a company car, free or subsidised accommodation and preferential loans, received from an employer, by an employee whose total remuneration (including benefits-in-kind) is €1,905 or more in a tax year, are taxable (subject to certain exceptions).
Where the employee receiving such benefits is a director of the company concerned, the benefits are taxable regardless of the level of remuneration. The liability to tax also applies in respect of benefits provided by an employer for a member or members of an employee’s family or household.
In addition, employees and directors are chargeable to tax in respect of ‘perquisites’ from their employment, that is, remuneration in non-money form which is convertible into money or money’s worth, for example vouchers in various forms, the payment of club subscriptions and medical insurance premiums on an employee’s behalf.
The basis of the BIK rate applicable to motor vehicles will change from miles to kilometres with effect from 1 January 2014
For 2009 and subsequent periods emission allowances will be the basis for assessing benefit in kind on company car. The employee is taxed on “notional pay” based on the cash equivalent of the benefit of use of a company car. This is calculated as a percentage of the car’s original market value (OMV), depending on your annual business travel and the car’s CO2 emissions category:
|Category A||0g/km up to and including 120g/km|
|Category B||More than 120g/km up to and including 140g/km|
|Category C||More than 140g/km up to and including 155g/km|
|Category D||More than 155g/km up to and including 170g/km|
|Category E||More than 170g/km up to and including 190g/km|
|Category F||More than 190g/km up to and including 225g/km|
|Category G||More than 225g/km.|
Where the annual business travel is:
|KM||A, B C||D, E||F, G|
|0 – 24 000km||30%||35%||40%|
|24000km – 23000km||24%||28%||32%|
|32000km – 40000km||18%||21%||24%|
|40000km – 48000km||12%||14%||16%|
|48000km and more||6%||7%||8%|
The BIK figure can be further reduced by the amount required to be made good, and actually made good, directly to the employer in respect of the car’s running costs
|Specified rate for home loans from 1 January 2013||4%|
|Specified rate for other loans from 1 January 2013||13.5%|
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