Taxation of benefit in kind

Spreading tax over the year

The employer must pay the following to the Collector-General on a benefit in kind (BIK):

This tax must be deducted from the employee’s pay and paid to Revenue for the pay period in which the employer provided the benefit.

Deducting the tax due on the benefit in one pay period may cause an employee hardship. If it does, the employer may spread the tax due on an employee's benefit over several pay periods in the year. Employers must still pay the full Income Tax, PRSI and USC due to the Collector General in the period the benefit is provided.

The annual value of a benefit must be spread over the pay periods in which the benefit arises from:

Income Tax, PRSI and USC must be calculated on the benefit for each pay period in which the use of the benefit is apportioned.

Next: Insufficient wages to deduct tax

Published: 23 September 2026 Print this page

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