Valuation of benefits

Payment of medical insurance for employees

You might pay medical insurance premiums on behalf of an employee. This is a taxable benefit for your employee. 

When you pay medical insurance premiums on behalf of an employee, you pay a reduced premium to the authorised insurer. The insurer will have applied Medical Insurance Relief, given as Tax Relief at Source (TRS), to the gross amount. You will need to return, to Revenue, the value of the Medical Insurance Relief. 

The value of the benefit, to your employee, is the gross value of the insurance premium. You must add this gross value, as notional pay, to your employee’s pay to deduct:

How to return the value of Medical Insurance Relief

Generally, you must pay the value of any Medical Insurance Relief to the TRS section in the Collector-General's Division

You must pay the amount of relief to Revenue as:

  • part of your Corporation Tax (CT) preliminary tax payment, if you are registered for CT and account for this in your CT1 form
  • part of your IT preliminary tax payment, if you are currently registered for IT and account for this in your Form 11
  • a cheque or bank draft if you are not registered for IT or CT
  • cheque or bank draft if you are non-resident.

You may claim a deduction for the gross value of the policy paid for Case I or Case II purposes.

Payment of medical insurance where employer is an insurer

You do not need to pay the value of any Medical Insurance Relief to Revenue if you are:

  • a medical or dental insurer
  • a tied agent of a medical or dental insurer
  • an employer connected to a medical or dental insurer or a tied agent. (If you are unsure if you are connected, please contact your Revenue office for further assistance.)

You may not claim a deduction for the gross value of the policy for Case I or Case II purposes. Instead, you may claim a deduction for any administrative costs incurred in providing a medical insurance policy for your employees.

Tied agent

In this scenario, a tied agent refers to any insurance agent who has entered into an agreement with a medical or dental insurer. The agreement either prevents or severely restricts their ability to sell medical or dental insurance policies offered by other medical or dental insurers.

Next: Goods and assets provided to employees