Taxes Consolidation Act 1997 section 121A

Benefit of use of van

Section 121A provides that an employee who has personal use of a van provided by his or her employer is subject to a benefit in kind (BIK) charge, calculated as a percentage of the van's original market value (OMV), with reductions available for all vans and enhanced reductions for electric vans.

• The BIK charge on a company van is 8% of the van's OMV (5% for years up to 2022), reduced by any contributions the employee is required to make and actually makes towards the cost of providing or running the van.
• For all vans, the OMV used in the BIK calculation is reduced by €10,000 for 2023 to 2026, by €5,000 for 2027 and by €2,500 for 2028; for electric vans, an additional reduction of between €10,000 and €35,000 applies from 2023 to 2027.
• No BIK arises where the van is necessary for the employee's work, the employee is required to keep it at home, private use other than commuting is prohibited and does not occur, and the employee spends at least 80% of working time away from the employer's premises.
• Where a van is available for only part of a tax year, the BIK charge is reduced proportionally based on the period of availability.

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