Use of facilities (sports, recreational, childcare and car-parking)
Crèche and childcare facilities
Employers may provide, or contribute towards, childcare for employees.
Employer-provided facility
If employers provide free or subsidised childcare facilities at work for employees, this is a benefit in kind (BIK). The employees who use these facilities are chargeable on the benefit under the Pay As You Earn (PAYE) system to:
Calculation of the taxable benefit
The value of the benefit for tax purposes is the cost of providing the facility, including insurance, maintenance and suchlike. It also includes the cost of providing childcare services such as salaries and other expenses.
Where more than one employee uses the facility, the value of the BIK should be apportioned. This apportionment should be based on the number of children each employee has in the facility.
Independent facility
If employers pay or subsidise the cost of an independent crèche or childcare facility for employees, this is a taxable benefit. The employees that use the facility must pay Income Tax, PRSI and USC on this benefit.
If employers make a block payment to a crèche or a childcare facility, this is a BIK. The employees that use the facility must pay Income Tax, PRSI and USC on this benefit.
Calculation of the taxable benefit
Where more than one employee uses the facility, the value of the BIK should be apportioned. This apportionment should be based on the number of children each employee has in the facility.
For further information, please see Section 5 of the Tax and Duty Manual Part 05-01-01L.
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