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Private use of employer-provided vehicles

  1. Overview
  2. How to calculate the taxable benefit
  3. Employees with low business kilometres
  4. Employer-provided vehicles not available for the full year
  5. Exemptions
  6. Other Benefit-in-Kind issues

Employer-provided vehicles not available for the full year

Your employee may not have use of the car for the full year. This may be because your employee:

  • received a car during the year
  • gave up a car before the end of the tax year
  • or
  • travelled abroad for work without the car.

Where this happens, you can reduce the cash equivalent to reflect the number of days your employee actually had the car. You can ‘annualise’ the business kilometres to calculate the cash equivalent of the car. This allows you to see what the cash equivalent would have been if your employee used the car for the full year.

You can reduce the cash equivalent by the number of days the car was not in use that year.

  • Example

    Your employee had the use of an employer-provided vehicle for 153 days for 2023. The Original Market Value (OMV) of the car is €28,000 and it is a Category C vehicle.

    The employee travelled 12,000 business kilometres in 2023. He paid €750 that year towards the running costs of the car.

    Annualised business kilometres for the year is worked out as 12,000 kilometres x 365/153 = 28,627 kilometres.

    The cash equivalent is equal to the OMV minus €10,000 x 24% (kilometres driven between 26,001 and 39,000). This is then reduced to reflect the number of days the car was actually in use.

    Calculation of taxable benefit
      CalculationValue
    Cash equivalent €18,000 x 24% x 153 / 365 €1,810
    Amount paid for running costs   €750
    Taxable benefit   €1,060

     

Next: Exemptions

Published: 25 January 2024 Print this page

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