BIK on company vehicle

Is this taken at source or is the employee supposed to make some sort of declaration to the revenue? the reason I ask is that I've had a company vehicle for a few months now and haven't seen any adjustment to my monthly pay cheque. I'm not sure if this is an oversight on the employers end or if there is something I'm supposed to be doing.

As far as I know most, if not all, non exempt BIKs are subject to BIK income tax/PRSI deductions at source (payroll) these days. See [broken link removed].

Thanks for the quick response. That was my understanding of the BIK requirements as well. Presumably I'm liable for whatever tax should have been paid to date but can I be hit with penalties, charged interest on back tax etc? Or is it purely the company's responsibility to make sure all this stuff is in order? Or is this something I should talk to the revenue about directly?

It is unlikely that you will be hit with interest or penalties especially if you sort it out soon. However if the company should be dealing with this through payroll then they really need to get their act together. And if they are making mistakes in this context if I was you I'd check the rest of my payslips/P60 carefully and ask Revenue for P21 balancing statements for up to the lst 4 years.

In fairness they've always been on the ball with all the other tax/prsi stuff - at least they're numbers have always tallied with my own. Think I'll have a word with the boss in the morning. Thanks very much for the help.

That's probably the best approach. Maybe it is just an honest mistake/oversight (assuming it is a mistake).

You may find, as I did, that the BIK figure is added to your taxable pay to calculate tax and PRSI but won't appear on your 'bottom line' gross salary. Therefore it is not immediately visible.
On your year to date pay - subtract your taxable pay from your gross salary and if the figure doesn't equal your pension contributions, you may already be paying tax on your BIK.

Is it a car or a van? If it is a van you may have nothing to worry about. The following is a statement made in relation to company vans...

BIK would not be charged in relation to such vans, provided that the van was essentially for the purposes of the employee's work, that there was an employer requirement to bring the van home, that other private use was prohibited and the employee spent most of his or her working time away from the employer's workplace to which he or she is attached.

well it's a car, available continuously and exclusively to myself, so I don't think there's any way around treating it as a taxable benefit. Had a word with one of the management staff yesterday. It's looking like our accountant forgot that the BIK guidelines changed in 2004 so that it's taken at source and he assumed I'd be declaring it myself. not exactly clever but shouldn't be the end of the world either. Anyway, now that payroll are aware of it i'm leaving it to them to sort out. Meanwhile however, i'm left with this pressing desire to do a detailed review of all my tax and salary records for the last couple of years.

Mart said:

It's looking like our accountant forgot that the BIK guidelines changed in 2004 so that it's taken at source and he assumed I'd be declaring it myself.

Click to expand...

I have had similar experiences of accountants making what I would have considered relatively basic mistakes (although Brendan disagrees with me on this - but he would say that, wouldn't he ) with payroll in the past too. For example - miscalculating PRSI based on using 4 times the weekly PRSI exemption (4 x €127) instead of the higher monthly exemption (€551) amounts and incorrectly applying tax and PRSI deductions at source to ESPP share purchases (Employer deduction of BIK tax/PRSI on share options).

You should indeed review your tax/payroll affairs and maybe ask Reveunue to prepare P21 balancing statements for up to the past 4 years to check for any discrepancies (hopefully refunds!).