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Why is my health insurance BIK so high on payslip?

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  • 25-07-2022 6:41pm
    #1
    SG250
    Registered Users Posts: 15 ✭


    I signed up for VHI health insurance via fully funded company plan and the BIK deduction on my payslip seems a little high.

    The charge is 150 per month deducted from my gross income.

    Given my marginal tax rate is 52% and the below is on my plan it doesn't make sense:

    Total Premium: 258.81EUR

    Period of Cover: 11/05/2022 - 31/07/2022

    Or am I completely wrong about how it works.

    Tagged:


Comments

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    #2
    relax carry on
    Registered Users Posts: 4,079 ✭✭✭relax carry on


    BIK is the value of the benefit which is added to your gross pay. You are then taxed on your gross pay + the BIK amount. If the gross subscription you pay is roughly 260 euro per month and you are a higher rate tax payer then 52% of that amount equates to the tax you pay on the benefit received. Have a chat to your payroll section to ensure you understand the value of the benefit received and what you are being taxed on.



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    #3
    Green Mile
    Registered Users Posts: 495 ✭✭Green Mile


    You can claim medical insurance tax credits when your company covers the cost of insurance.

    Revenue will increase your tax credit allowance but you need to inform them. A lot of people dont know this.

    https://www.revenue.ie/en/personal-tax-credits-reliefs-and-exemptions/health-and-age/medical-insurance-premiums/index.aspx

    Apply for it on your myAccount or give Revenue a call on 01 7383636



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