Finance Bill 2019 personal and employee tax

Oct 21, 2019

No across-the-board personal tax cuts or amendments to the core income bands or rates for either income tax or USC. The Bill provides for the minor increases in the Home Carers Credit and the Earned Income Credit.  The reduced USC rate for medical card holders is extended.  There are changes to the benefit-in-kind on employer provided vehicles.  As expected, the Bill extends both the Special Assignee Relief Programme and the Foreign Earnings Deduction to 31 December 2022.  Brexit related measures are introduced to continue entitlement to tax credits and reliefs for qualifying UK residents.

BIK on company cars

Section 5 of the Bill amends the current exemption for electric cars and vans with a market value of less than €50,000 in section 121 of the Taxes Consolidation Act 1997 by extending the exemption to 31 December 2022.

A new charging regime for employer provided cars will take effect that will be based on kilometres travelled and the CO2 emission levels of the car in 2023. 

The rate of benefit-in-kind on employer provided vans in section 122 of the Taxes Consolidation Act 1997 will increase from 5 percent to 8 percent of the original market value of the van from 1 January 2023.

Employee incentives

Section 8 amends section 825C of the Taxes Consolidation Act 1997 which provides relief from income tax on 30 percent of salary between €75,000 and €1 million to qualifying employees under the SARP, by extending the relief to 31 December 2022. 

Section 9 amends section 823A of the Taxes Consolidation Act 1997, which provides for relief from income tax on up to €35,000 of salary for certain employees under the FED. The effect of the amendment is to extend the relief to 31 December 2022.

Brexit

Section 11 of the Bill introduces changes to section 1032 of the Taxes Consolidation Act 1997 to allow qualifying UK residents to retain entitlement to certain personal allowances, deductions and reliefs in the event that the UK is no longer a member of the EU.