Changes to Benefit-in-Kind

As part of the cost-of-living budget measures, Revenue have made changes to the Benefit-in-Kind (BIK) regime regarding company cars.

As a result of the move to a CO2-based BIK system, incentivising the use electric and low-emission cars, employees with cars in the usual emissions range have found increases to their income tax liabilities since the beginning of 2023.

To remedy this, a relief of €10,000 has been introduced, applicable to Original Market Value (OMV) of cars in Category A-D. This is intended to reduce the amount of BIK payable.

Essentially, this means that employers may reduce the OMV by €10,000 for the purposes of calculating BIK liability.

This treatment will also apply to all vans and electric vehicles. For electric vehicles, the OMV deduction of €10,000 will be in addition to the existing relief of €35,000 that is currently available for EVs, meaning that the total relief for 2023 will be €45,000.

These temporary measures will apply retrospectively, from 1 January 2023 through to 31 December 2023.

See the table below for updated mileage limits:

Business Mileage   Vehicle Categories
Lower limit (1) Upper limit (2) A (3) B (4) C (5) D (6) E (7)
Kilometres Kilometres Per cent Per cent Per cent Per cent Per cent
26,000 22.5 26.25 30 33.75 37.5
26,001 39,000 18 21 24 27 30
39,001 48,000 13.5 15.75 18 20.25 22.5
48,001 9 10.5 12 13.5 15

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