With the outbreak of Coronavirus (COVID-19) restricting most employees to working from home, many organisations are questioning how this effects BIK for company cars. Fortunately Revenue have provided guidance on calculating payroll during the Covid19 lockdown to employers who are providing cars or vans to their employees:
- Where the employer takes back the car- then it is not available to the employee and no Benefit-in-kind applies for the duration of the lockdown.
- Where an employee retains possession of a vehicle, but the employer prohibits the use of the vehicle, it is recommended that you issue a letter to this effect and request employees to take a photo of the odometer readings at the beginning and again at the end of the COVID-19 restrictions. No BIK shall apply if the vehicle is not used for private use.
- Where an employee continues to undertake business travel as usual in an employer-provided vehicle, the usual BIK rules will apply.
- Where none of the above applies, and the employer allows limited business or personal use of the vehicle, then the January 2020 mileage should be used as a base month for calculating the amount of BIK due. Again appropriate records should be kept, for example, business mileage travelled in January, amount of private use, photographic evidence of odometer etc. Please note that according to Revenue at this time, the annualised mileage will apply as usual for 2020.
Further details and information are available here
To keep up to date on how Coronavirus is impacting payroll in Ireland and the UK visit our COVID-19 Information and Resources page: https://www.paycheckplus.ie/information-guides-tax-paye-forms-download/covid-19-information-and-resources/
If you would like to know how we could help your business, contact us today on +353 (0) 1 905 9400
Disclaimer: The material contained within this email is intended for general information purposes only and does not constitute legal advice. Every effort have been made to ensure that the information provided in this email is accurate and up-to-date. The material contained in this email is based on Revenue Guidelines as of the 6th April 2020. Guidelines are subject to change and email recipients are advised to consult the www.revenue.ie for the latest updates and information.