Private use of company cars

Exemptions

Car-pools

If your employee uses a company car in a car-pool they do not have to pay Pay As You Earn (PAYE), Pay Related Social Insurance (PRSI) and Universal Social Charge (USC) on this benefit.

A car-pool exists where:

  • a car is available and used by more than one employee
  • the car must not be regularly used by one employee who prevents others from using it
  • private use of the car by the employee is minimal
  • the car is not regularly kept overnight at or near the employee’s home.

State employees may have to drive a State-owned car as part of their job. They may keep that car overnight at or near their home, if:

  • they are on call outside their normal working hours
  • the car would otherwise be a ‘pool car’.

If you are unsure if a car is part of a qualifying car pool, please contact your local Revenue Office.

Electric vehicles

Certain BIK exemptions and discounts are available where the car made available to your employee is an electric car.

Electric cars are cars that get their motive power from electricity only. Hybrid cars do not qualify as electric cars.

The treatment applies to both new and used cars.

2018 Exemption

You may have made an electric car available to your employee for private use during 2018. Where this occurred, no charge to BIK arises in respect of any use by your employee in 2018.

2019 to 2021 Extension of Exemption

You may choose to make an electric car available to your employee for private use between now and 31 December 2019.

Where this occurs, no charge to BIK arises in respect of any use by your employee where either of the following apply:

  • the OMV of the car is €50,000 or less
  • or
  • you first made this car available to your employee between 10 October 2017 and 9 October 2018.

Where neither of the above apply, only a partial exemption is available. This is granted by reducing the OMV by €50,000 when calculating the cash equivalent for the car.

Next: Other BIK issues