Dáil Éireann Debate, Monday - 11 September 2023
457. Deputy Claire Kerrane asked the Minister for Finance if consideration has been given to extending benefit-in-kind measures beyond the current December 2024 deadline; and if he will make a statement on the matter. [38295/23]
Amharc ar fhreagraIn light of the cost of living crisis, the Government recognised the difficulty experienced by some people who faced BIK increases under the new 2023 regime. Therefore, temporary changes were made to BIK for 2023 which will help lessen the BIK liability for most people.
This temporary change takes the form of a universal relief of €10,000 which is currently applied to the Original Market Value (OMV) of vehicles in Category A-D in order to reduce the amount of BIK payable. This means that, for the purposes of calculating BIK liability, employers may reduce the OMV by €10,000 i.e. the BIK liability for a car worth €50,000 will now be calculated using €40,000 as the OMV. This relief also applies to vans and electric vehicles, however does not apply to cars in category E – the highest emission category. For electric vehicles, the OMV deduction of €10,000 is in addition to the existing relief of €35,000 that is currently available for such vehicles, meaning that the total relief for 2023 is €45,000.
Additionally, the lower limit in the highest mileage band has been amended by way of a 4,000km reduction, so that the highest mileage band is now entered into at 48,001km. This amendment will help those employees who drive particularly large amounts of mileage and will result in their BIK liability being reduced. This change is in recognition of employees driving cars more integral to the conduct of business.
This was introduced as a temporary measure for 2023 and is due to remain in place until 31 December 2023.
Regarding any future decisions, it is a longstanding practice of the Minister for Finance not to comment further, in advance of the Budget, on any tax matters that might be the subject of Budget decisions.
