Plan to tax use of vans scrapped

EMPLOYEES who bring company vans home at night will not now be subject to benefit-in-kind (BIK) tax.

Minister for Finance Charlie McCreevy yesterday confirmed he has decided to reverse the decision made in last year’s budget to apply BIK tax to company vans that were taken home by employees at night and at weekends.

The measure was to take effect from January 1 next.

However, the minister said a major concern had been brought to his attention in relation to those employees whose only private use of the company van was to bring it home at night.

Having reviewed the anomaly, Mr McCreevy said he would not apply any BIK taxes to vans provided it was mainly used for work; that the employer required the van to be brought home after work; that other private use was not allowed; and that the employee worked mainly away from the workplace.

“I am prepared to make this concession, given the particular work arrangements involved,” said Mr McCreevy.

Saying that it was never the intention to apply BIK tax to something that is for business use, he also pointed out that similar concessions had been granted for the use of mobile phones, home-based computers and high-speed internet connections when they were mainly for business rather than private use.