Dáil Éireann Debate, Thursday - 14 February 2013
149. Deputy Róisín Shortall asked the Minister for Finance if the use by hospital consultants of public health facilities for work for which they charge private patient fees is taxable as a benefit-in-kind and, if not, the reason for same and his estimate of the yield that would arise if it were. [7980/13]
View answerA benefit in kind charge under the provisions of Section 118 TCA 1997 arises where an employer incurs expense in the provision of living or other accommodation, entertainment, domestic or other services, or other benefits or facilities of whatever nature. The charge is based on the amount of the expense that is not made good to the employer by the employee. Facilities provided to hospital consultants for use in their private practice can include equipment, premises and staff. Determining the expense incurred by the employer in the provision of these facilities is particularly difficult. For example, the value of the use of hospital premises is defined as the annual rent that might be expected to be obtained on a yearly letting. In the case of a specialised building such as a hospital this would be difficult to ascertain. In the case of other assets such as machinery the value of the use of the machinery is taken to be 5% of its market value. Again, this would be difficult to determine given the nature of the equipment in a hospital.
Hospital facilities are not provided solely to enable the consultants to carry on private practice in the hospitals concerned. Clearly, the primary purpose of the provision of the facilities is to enable the consultant to treat public patients.
The difficulty in determining a benefit in kind charge is further compounded by the fact that the facilities can be shared by a number of consultants to varying degrees and that usage can vary depending on the availability of a consultant and the extent to which his or her specialist services may be required. Taking all these factors together it is difficult to establish for each individual consultant a charge that reflects the benefit received. Given that benefit in kind is operated via the PAYE system attempting to quantify a charge would impose a significant burden on payroll departments.
The application of benefit in kind in these circumstances is complicated but I am advised by the Revenue Commissioners that this particular issue is under active consideration.
In the circumstances it is not possible to estimate the yield from the imposition of a benefit in kind charge.
