Benefit in Kind Query

S

Saab

Guest
Hi All,

Can someone please help me out with the following "hypothetical" scenario:

A PAYE worker has the use of a company car since late 2003. This person's contract of employment states that he is responsible for paying BIK on the car. However new legislation effective since 01/01/2004 states that the employer is responsible for deducting monies owed in respect of BIK and remitting with PAYE, PRSI to Revenue. So our friend is happy and doesn't get concerned with BIK any more. However, on receipt of his statement of tax credits he notices there is no mention of BIK on the statement. He is now concerned that his employer is not remitting BIK from his salary and is worried that he might get hit with a bill from Revenue. He has already spoken to a nice lady in Revenue who says that the employer definitely should be remitting his BIK and that they cannot say in his contract that he is responsible for it.

What should he do? If he stays quiet, is he running the risk of being hit with a bill? Would he have any recourse to his employers if this happened? Should he follow it up with his payroll dept? He works for a major insurance company. Should he just say nothing and trust that the payroll dept know what they are doing?
 
It should appear on their payslips if they are paying BIK or not. (They will be paying tax & PRSI on their salary + a notional amount.)


www.payback.ie
 
Never Trust the payroll dept we all make mistakes.

The notional amount should equate to the benefit i.e. 30% of the value of the car in this instance. This is then taxed as income in the normal way.
 
asdfg said:
Never Trust the payroll dept we all make mistakes.

The notional amount should equate to the benefit i.e. 30% of the value of the car in this instance. This is then taxed as income in the normal way.

And just because the employer is responsible for administering it now you will still be the one to pay for the mistake, they will likely correct it by spreading it out over the remainder of the year.
 
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