Payment is received from employee.
On 1 January 2023, you provide an employer-provided van to your employee for business and private use. The OMV of the van is €28,000. Your employee pays you €500 annually towards the running costs of the van. The calculation of the value of the benefit is:
OMV 28,000 less €10,000 = €18,000)
€18,000 x 8% = €1,440
Less amount paid by employee (€500)
Value of the benefit €940
As the value of the benefit is €940, this must be added to their taxable pay for the year. Notional pay of €940 (€18.07 per week or €78.33 per month) should be added to their wages or salary. Income Tax, PRSI and USC should be calculated on the total amount.