Private use of employer provided vehicles
Exemptions
Car pools
If your employee uses an employer provided vehicle in a car pool, they do not have to pay the following on this benefit:
A car pool exists where:
- a car is made available, and is used, by more than one employee
- the car is not ordinarily used by just one employee, thus preventing others from using it
- private use of the car by the employee is incidental
- and
- the car is not normally kept overnight at, or near, the employee’s home.
State employees may have to drive a State owned car as part of their job. They may keep that car overnight at, or near, their home, if:
- they are on call outside their normal working hours
- and
- the car would otherwise be a ‘pool car’.
If you are unsure if a car is part of a qualifying car pool, please contact your Revenue Office.
Electric vehicles
Certain benefit in kind (BIK) exemptions and discounts are available where the car made available to your employee is an electric car. Electric cars are cars that get their motive power from electricity only. Hybrid cars do not qualify as electric cars. This treatment applies to both new and used cars.
Exemption
There was an exemption available where you made an electric car available to your employee for private use in 2019 to 2022. For further information, please see Section 6.2 of TDM Part 05-01-01b. For details of exemptions in relation to electric vans, please see Private use of employer provided vans.
2023 to 2027 extension of exemption
You may choose to make an electric car available to your employee for private use. Partial relief will apply in respect of electric cars made available between 1 January 2023 and 31 December 2027.
This relief applies by reducing the Original Market Value (OMV) of the car. The reductions which apply are:
- €35,000 in respect of cars made available during 2023, 2024 and 2025
- €20,000 in respect of cars made available during 2026
- and
- €10,000 in respect of cars made available during 2027.
Where the relief reduces the OMV to nil, a BIK charge will not arise. Any OMV in excess of the reduction is liable to BIK in the usual manner.
For 2023, 2024 and 2025, an additional reduction of €10,000 can be applied to the OMV.
Exemptions relating to the charging of electric vehicles
An exemption from BIK applies where you provide a charging point for electric vehicles (including hybrid vehicles) on your business premises. The exemption only applies where the facility is available for use by all employees and directors.
From 1 January 2025, a further exemption applies in relation to electric charging points. Subject to certain conditions, no BIK charge will apply where you incur expense providing an electric vehicle charging point at your employees or directors main private residence. To avail of this exemption:
- you must retain ownership of the electric charging facility
- the employee or director must have the private use of your electric vehicle
- and
- the charging point must be installed at a private residence situated in the State. The residence must be the employee's or director's sole, or main, residence for the year of assessment.
The exemption does not apply where your employee or director has the private use of a hybrid electric vehicle.
Full details of the conditions relating to this exemption can be found in the Tax and Duty Manual Part 05-01-01b.
Next: Other benefit in kind (BIK) issues