Personal Use of Company Van

air

Quick Hypothetical Query on BIK:
Reading up on the revenue's site on BIK and it seems that exemptions are available for the following:

Cars in Car-Pools

There is no charge to tax in respect of a car which is in a car-pool.
A car can be treated as being in a pool if:
# The car is made available to and is actually used by more than one employee to the exclusion of the others, and
# Any private use of the car by any employees is merely incidental to business use, and
# It is not normally kept overnight at the home of any employees.

Private Use of Company Van

There will not be a charge to tax in respect of a company van where all of the four conditions below are met:

* The van provided is essential for the purposes of the job
* The employer requires that the employee brings the van home
* Any private use (other than travelling to and from work is prohibited), and
* Not less than 80% of the employee's time in the performance of his or her duties is spent away from the employer's premises to which the employee is attached.

Now say you have a company with a company van that:
Does 40k miles or so per year
Has 10 people insured on it and they all drive it from time to time
It is sometimes kept at the office, sometimes at the home of whoever has it
About 60% of the time it is used by one employee who uses it for some personal use

If it was a car it would would qualify for the 6% rate as it does over 30k pa

It would qualify as a pool car only that it is sometimes at the home of employees

It would qualify for the van exemption only that the employer doesnt really strictly ban private use

Should the employee using it most be paying BIK on the 5% value?

ck1

Following the introduction of the new BIK rules, a statement was issued by the Revenue following lots of queries regarding Company Vans. The following is the exact statement....

Press Release by Minister for Finance on 18 November 2003

BIK Not to Apply to Vans Kept Essentially for Business Use
The Minister announced in last year's Budget that from 1 January 2004 all benefits in kind currently taxable would be brought within PAYE. The new system would mean that from a tax equity point of view all income and benefits in general would be treated the same way for the purposes of income tax, PRSI and the Health Levy. Currently, while certain benefits are subject to income tax, PRSI and the Health Levy do not apply.
The Minister said "that a major concern has been brought to my attention recently to the effect that, under the terms of the new scheme, PAYE, PRSI and levies would apply to employees' private use of company vans from 1 January next year in relation to employees whose sole private use of such a van was to bring it home."
The Minister indicated that, having examined the matter on foot of these concerns, he would not apply any BIK charge 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.
The Minister said "I am prepared to make this concession, given the particular work arrangements involved". As already indicated, the scheme will include a new exemption from benefit in kind in relation to mobile phones, home-based computer equipment and high speed internet connections where these are for business use and where private use is incidental. "It is not the intention to apply BIK to something that is for business use" the Minister said.
The new scheme will come into effect on 1 January 2004 as announced in last year's Budget.
ENDS.

air

Thanks for that ck, even more people have joined the company since in any case, making the issue a bit of a moot point at this stage.