Finance Bill 2019 environmental related tax measures

Oct 21, 2019

In his speech on Budget day the Minister announced a few measures to support a more environmentally friendly economy, including the increase in carbon tax to €26 euro per tonne. Finance Bill 2019 includes environmental aspects which involve electric vehicles and CO2 emissions.

CO2 based limits on capital allowances & expenses for motor vehicles

The Bill provides that capital allowances on business cars and the tax deductions for costs of hiring business cars will be determined by the CO2 emissions threshold. The amendment will apply from 1 January 2021 except where prior to that date a contact for hire was entered into and the first payment under the contract was made.

Benefit in Kind

The exemption from benefit in kind rate for electric cars and vans with a market value of less than €50,000 is extended to 31 December 2022. Read above under employee tax for details on the other changes to the BIK provisions.