Benefit in Kind Excluding Motor Vehicles

COVID-19 Revenue Guidance: Tax treatment of reimbursements by an employer to an employee regarding holiday/flight cancellations or in relation to costs of assisting employees returning to the State.

Provided the employee is integral to the business and was required to return to deal with issues related to the COVID-19 crisis by his or her employer, the costs incurred are reasonable and the employee is not otherwise compensated (i.e. via an insurance policy or direct claim to the service provider), a Benefit in Kind will not arise. This may include costs related to family members who were on holiday or due to go on holidays with the employee. 

Employer-provided Equipment

A Benefit in Kind will not arise where employers provide equipment such as laptops, printers, scanners and office furniture in order for employees to set up a working space in their homes.

e-Working and Tax

Guidance on the tax treatment of e-workers and remote workers can be found at:
https://www.revenue.ie/en/tax-professionals/tdm/income-tax-capital-gains-tax-corporation-tax/part-05/05-02-13.pdf

Payment of Taxi Fares

Where an employer pays for a taxi to transport an employee to or from work due to health and safety concerns, Benefit in Kind will not apply for the duration of the COVID-19 period only.

Small Benefit Exemption

Section 112B of the Taxes Consolidation Act 1997, allows one voucher per year up to the value of €500 to be given to an employee by his or her employer tax free, provided certain conditions are satisfied. Where an employer wishes to recognise efforts of frontline or other key staff working during the COVID-19 crisis, either by accelerating part of a reward (voucher) usually paid later in the year, or making an additional voucher award, the requirement that only one voucher issues (as per s112B(1)(d)) is concessionally waived for the 2020 tax year, where the additional award is related to an employee’s exceptional efforts during the COVID-19 crisis.

This concession only applies to employees who continue to work during the restricted period. All other conditions of the section must be met, for example the maximum (cumulative) value may still not exceed €500 but, as stated above, the requirement to only issue one voucher will be waived. Appropriate documentation must be retained by an employer where this concession is availed of.