Small Benefit in Kind (BIK) Exemption

Finance Bill 2022 amends the Small Benefit Exemption provision to provide for:

  • an increase in the combined aggregate value of benefits or vouchers an
    employer can give in a tax year to a maximum of €1,000 (from €500), and
  • an increase in the combined number of such benefits that can be given in a
    tax year from one to two.

These benefits must not be in cash and the combined value of the two benefits cannot exceed €1,000.

Tax-free vouchers or benefits can be used only to purchase goods or services and cannot be redeemed for cash

Also, if more than two benefits are given in a year, only the first two may qualify for
tax exemption (provided all other conditions of the section are satisfied).

This updated treatment will apply for the 2022 year of assessment and subsequent years.

The Small Benefit Exemption provides a tax efficient way to reward staff (which includes Directors).

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Guidelines :


Disclaimer :

Whilst every effort has been made to ensure the accuracy of matters covered by this article, no responsibility for loss or damage occasioned by any person acting, or refraining from acting, as a result of matters above. Professional advice should always be sought before acting on any interpretation of matters covered by this article.

27 November 2022