Tax on benefit in kind

[Dorothymary]

I have been getting medical insurance as a benefit in kind for some years.
When it was taken out the employer advised that it would be taxable.
My fee was the main premium fee although some other employees fees would have been too high depending on their age health etc so some opted not to do it.
However recently I have learned some new employees have been charged tax on the health insurance and I’m still not being taxed but when I started it I had been charged some amounts but then it wasn’t in further payslips when I queried it with the provider they said th employer pays for the full amount so I’m confused now.
I had queried it with my employer at the start as I didn’t want to pay anything I just opted in on the basis it was totally free.
Should I be worried about getting a major tax bill or should I just leave as is

 

[ClubMan]

Sounds like you should be paying tax on the benefit in kind.

You might want to read this:

Health insurance premiums

This page outlines the health insurance premiums you may be entitled to

www.revenue.ie

 

[Protocol]

Have you carefully checked your payslip, to see whether the tax on the BIK is there?

 

[Dorothymary]

Yes I’ve checked and there’s nothing there for that BIK

 

[ClubMan]

You should check your Revenue myAccount to see if the BIK has been declared for at least this year and the previous 4 tax years if applicable.

 

[redstar]

My payslip shows a BIK amount for my employer-paid Health Ins. The BIK amount is added to normal gross salary amount and taxed as normal via PAYE/PRSI/USC.

On my annual tax return i claim the tax-relief on the premium too as its not given at source.

Health insurance premiums

This page outlines the health insurance premiums you may be entitled to

www.revenue.ie

 

[redstar]

Also your employer should be adding your H Insurance details as a BIK...

Payment of medical insurance for employees

This is a guide on the payment of medical insurance for employees

www.revenue.ie

 

[Dorothymary]

So does that mean they might be taxing it for me through my gross pay ? And it’s just all included in USC and PAYE etc?

 

[redstar]

It maybe, but it should be shown on your payslip as a separate item. Is your monthly gross pay amount higher or the same as your normal salary/12 ?

 

[thecoffeepod]

does that mean they might be taxing it for me through my gross pay ? And it’s just all included in USC and PAYE etc

No that definitely probably isn't happening

because in order for that to happen they would have to add the benefit into the gross salary

and then do a net deduction for the balance that's been paid out after the tax charged

so for example if that was a mess up ,they would be adding 100 Euros as gross pay for example

but then after tax let's say 48 euros due

Then they have to put in a payment recovered for this to bring to zero

it's more convoluted

Bik should be a notional value you're taxed on



in reality probably what's all after happening is they're forgetting to do the benefit kind

if they did the benefit in kind correctly as a standalone line in a payslip that connect to the revenues payroll submissions under revenue online service

which connects further back into your own my account

you can view your active employment and you can click into the payrolls and view to details and if BIK is showing as zero then you know they haven't been doing it correctly eh at all

 

[Villaines]

If the employer fails to declare the BIK in your payslip, then if Revenue uncover it, Revenue will not chase a PAYE employee for payment - instead Revenue require the employer to pay the tax due. This is standard practice. The employer is on the hook, not the employee.

Yes the employer could then look to you but generally employees play the fool then and the employer has to suck it up.

However, if there is no BIK being declared, then you shouldn't be claiming the income tax credit of max €200 per adult policy and €100 per child policy in your tax credit certificate.