Private use of employer-provided vans

  1. Overview
  2. Calculating the cash equivalent of employer-provided vans
  3. Van allowances
  4. Exemptions from Benefit-in-Kind (BIK)

Calculating the cash equivalent of employer-provided vans

The cash equivalent of a van you provide for an employee is 8% of the Original Market Value (OMV) of the van. Up to December 2022, the cash equivalent was calculated at 5% of the OMV of the van. If the van has been modified, the OMV should exclude this modification. An example of modification would be where a refrigeration unit has been installed.

If your employee pays for the cost of running the van, the cash equivalent should be reduced by the amount paid.

When you have determined the cash equivalent, you should deduct the following from the total amount:

For 2023 and 2024, a reduction of €10,000 can be applied to the OMV of vans for the purpose of calculating the cash equivalent.

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

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

Where this happens, you can reduce the cash equivalent to reflect the number of days your employee actually had the van. For example, if the van is only made available for 13 weeks of the year, the ‘cash equivalent’ would be one-quarter of the amount it would be for a full year.

Next: Van allowances