Taxes Consolidation Act, 1997 (Number 39 of 1997)
118 Benefits in kind: general charging provision.
[ITA67 s117; FA73 s41; FA74 s86 and Sch2 PtI; FA96 s131(9)(a)]
(1) Subject to this Chapter, where—
(a) a body corporate incurs expense in or in connection with the provision, for any of its directors or for any person employed by it in an employment to which this Chapter applies, of—
(i) living or other accommodation,
(ii) entertainment,
(iii) domestic or other services, or
(iv) other benefits or facilities of whatever nature, and
(b) apart from this section the expense would not be chargeable to income tax as income of the director or employee,
then, sections 112, 114 and 897 shall apply in relation to so much of the expense as is not made good to the body corporate by the director or employee as if the expense had been incurred by the director or employee and the amount of the expense had been refunded to the director or employee by the body corporate by means of a payment in respect of expenses, and income tax shall be chargeable accordingly.
(2) Subsection (1) shall not apply to expense incurred by the body corporate in or in connection with the provision for a director or employee in any of its business premises of any accommodation, supplies or services provided for the director or employee personally and used by the director or employee solely in performing the duties of his or her office or employment.
(3) Subsection (1) shall not apply to expense incurred by the body corporate in or in connection with the provision of living accommodation for an employee in part of any of its business premises which include living accommodation if the employee is, for the purpose of enabling the employee properly to perform his or her duties, required by the terms of his or her employment to reside in the accommodation and either—
(a) the accommodation is provided in accordance with a practice which since before the 30th day of July, 1948, has commonly prevailed in trades of the class in question as respects employees of the class in question, or
(b) it is necessary in the case of trades of the class in question that employees of the class in question should reside on premises of the class in question;
but this subsection shall not apply where the employee is a director of the body corporate in question or of any other body corporate over which that body corporate has control or which has control over that body corporate or which is under the control of a person who also has control over that body corporate.
(4) Subsection (1) shall not apply to expense incurred by the body corporate in or in connection with the provision of meals in any canteen in which meals are provided for the staff generally.
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(5) Subsection (1) shall not apply to expense incurred by the body corporate in or in connection with the provision for a director or employee, or for the director’s or employee’s spouse, children or dependants, of any pension, annuity, lump sum, gratuity or other like benefit to be given on the death or retirement of the director or employee.
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(5) Subsection (1) shall not apply to expense incurred by the body corporate in or in connection with the provision for a director or employee, or for [7]>the director’s or employee’s spouse, children or dependants<[7][7]>the director’s or employee’s spouse, civil partner, children or dependants, or the children of the director’s or employee’s civil partner<[7], of any pension, annuity, lump sum, gratuity or other like benefit to be given on the death or retirement of the director or employee, other than an expense incurred by way of contribution by the body corporate to a PRSA (within the meaning of Chapter 2A of Part 30).
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(5) Subsection (1) shall not apply to expense incurred by the body corporate in or in connection with the provision for a director or employee, or for the director’s or employee’s spouse, civil partner, children or dependants, or the children of the director’s or employee’s civil partner of any pension, annuity, lump sum, gratuity, contribution to a Personal Retirement Savings Account (within the meaning of Chapter 2A of Part 30), contribution to a PEPP (within the meaning of Chapter 2D of Part 30) or other like benefit to be given on the death or retirement of the director or employee.
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(5A) Subsection (1) shall not apply to expense incurred by the body corporate in or in connection with the provision for a director or employee of a monthly or annual bus or train pass issued by or on behalf of Córas Iompair Éireann or any of its subsidiaries, or by or on behalf of a holder of a passenger licence granted under section 7 of the Road Transport Act, 1932, or by or on behalf of a person who provides a passenger transport service under an arrangement entered into with Córas Iompair Éireann in accordance with section 13(1) of the Transport Act, 1950.
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(5A) (a) Subsection (1) shall not apply to expense incurred by the body corporate in or in connection with the provision for a director or employee of a monthly or annual bus or railway pass issued by or on behalf of one or more approved transport providers for travel on either or both bus and railway.
(b) In this subsection—
“approved transport provider” means—
(a) Coras Iompair Éireann or any of its subsidiaries,
(b) a holder of a passenger licence granted under section 7 of the Road Transport Act 1932,
(c) a person who provides a passenger transport service under an arrangement entered into with Coras Iompair Éireann in accordance with section 13(1) of the Transport Act 1950,
(d) the Railway Procurement Agency or any of its subsidiaries, or
(e) a person who has entered into an arrangement with the Railway Procurement Agency, in accordance with section 43(6) of the Transport (Railway Infrastructure) Act 2001 to operate a railway;
“railway pass” includes a pass issued by a railway designated as a light railway or as a metro in a railway order issued under section 43 of the Transport (Railway Infrastructure) Act 2001.
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(5A) (a) Subsection (1) shall not apply to expense incurred by the body corporate in or in connection with the provision for a director or employee of a monthly or annual bus, railway or ferry travel pass issued by or on behalf of one or more approved transport providers [8]>and which must be for a service for which the approved transport provider is contracted or licensed<[8].
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(b) In this subsection—
“approved transport provider” means—
(a) Córas Iompair Éireann or any of its subsidiaries,
(b) a holder of a passenger licence granted under section 7 of the Road Transport Act 1932,
(c) a person who provides a passenger transport service under an arrangement entered into with Córas Iompair Éireann in accordance with section 13(1) of the Transport Act 1950,
(d) the Railway Procurement Agency or any of its subsidiaries,
(e) a person who has entered into an arrangement with the Railway Procurement Agency, in accordance with section 43(6) of the Transport (Railway Infrastructure) Act 2001 to operate a railway, or
(f) a person who provides a ferry service within the State, operating a vessel which holds a current valid—
(i) passenger ship safety certificate,
(ii) passenger boat licence, or
(iii) high-speed craft safety certificate,
issued by the Minister for Communications, Marine and Natural Resources;
“railway pass” includes a pass issued by a railway designated as a light railway or as a metro in a railway order made under section 43 of the Transport (Railway Infrastructure) Act 2001.
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(b) In this subsection “approved transport provider” means—
(i) a public transport operator within the meaning of section 2 of the Dublin Transport Authority Act 2008,
(ii) the holder of a licence in respect of a public bus passenger service under Part 2 of the Public Transport Regulation Act 2009, or
(iii) a person who provides a ferry service within the State, operating a vessel which holds a current valid—
(I) passenger ship safety certificate,
(II) passenger boat licence, or
(III) high-speed craft safety certificate,
issued by the Minister for Transport, Tourism and Sport.
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(5B) (a) Subsection (1) shall not apply to expense incurred by the body corporate in or in connection with the provision, without any transfer of the property in it, for a director or employee of a mobile telephone for business use where private use of the mobile telephone is incidental.
(b) The mobile telephones to which the exemption provided by this subsection applies include any mobile telephone provided in connection with a car or van notwithstanding that the vehicle is made available as referred to in section 121 or 121A, as the case may be.
(c) In this subsection “mobile telephone” means telephone apparatus which—
(i) is not physically connected to a land-line, and
(ii) is not a cordless telephone.
(d) For the purposes of paragraph (c)—
“cordless telephone” means telephone apparatus designed or adapted to provide a wireless extension to a telephone, and used only as such an extension to a telephone that is physically connected to a land-line;
“telephone apparatus” means wireless telegraphy apparatus designed or adapted for the purposes of transmitting and receiving either or both spoken messages and information (being information for the same purposes as the Electronic Commerce Act 2000) and connected to a public telecommunications network (as defined in the European Communities (Telecommunications Services) Regulations 1992 (S.I. No. 45 of 1992)).
(5C) (a) Subsection (1) shall not apply to expense incurred by the body corporate in or in connection with the provision for a director or employee of a high-speed internet connection to the director’s or employee’s home for business use where private use of the connection is incidental.
(b) In this subsection “high-speed internet connection” means a connection capable of transmitting information (being information for the same purposes as the Electronic Commerce Act 2000) at a rate equal to or greater than 250 kilobits per second.
(5D) (a) Subsection (1) shall not apply to expense incurred by the body corporate in or in connection with the provision, without any transfer of the property in it, for a director or employee of computer equipment for business use where private use of the computer equipment is incidental.
(b) In this section “computer equipment”, in addition to a computer, includes—
(i) a facsimile machine, and
(ii) printers, scanners, modems, discs, disc drives, and other peripheral devices designed to be used by being connected to or inserted in a computer and computer software to be used in such equipment.
(5E) (a) Subsection (1) shall not apply to expense incurred by the body corporate, or incurred by a director or employee and reimbursed by the body corporate, in or in connection with the payment on behalf of a director or employee of the annual membership fees of a professional body where membership of that body by the director or employee is relevant to the business of the body corporate.
(b) Membership of a professional body by a director or employee of a body corporate may be regarded as relevant to the business of that body corporate where—
(i) it is necessary for the performance of the duties of the office or employment of the director or employee, or
(ii) it facilitates the acquisition of knowledge which—
(I) is necessary for or directly related to the performance of the duties of the office or employment of the director or employee, or
(II) would be necessary for or directly related to the performance of prospective duties of the office or employment of the director or employee with that body corporate.
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(c) This subsection shall not apply as respects the year of assessment 2011 and each subsequent year of assessment.
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(5F) Subsection (1) shall not apply to expense incurred by the body corporate in or in connection with the provision, without any transfer of the property in it, for a director or employee of a mechanically propelled road vehicle which is—
(a) designed or constructed solely or mainly for the carriage of goods or other burden, and
(b) of a type not commonly used as a private vehicle and unsuitable to be so used.
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(5G) (a) Subject to paragraph (c) of this subsection, subsection (1) shall not apply to expense of up to [11]>€1,000<[11][11]>€1,250<[11] incurred by the body corporate in, or in connection with, the provision for a director or employee of a bicycle or bicycle safety equipment, where—
(i) the bicycle and bicycle safety equipment provided is unused and not second-hand,
(ii) the director or employee uses the bicycle or bicycle safety equipment, or the bicycle and the bicycle safety equipment, as the case may be, mainly for qualifying journeys, and
(iii) bicycles or bicycle safety equipment, or bicycles and bicycle safety equipment, as the case may be, are made available generally to directors and employees of the body corporate.
(b) In this subsection—
“bicycle” means a pedal cycle;
“bicycle safety equipment” includes—
(i) bicycle bells and bulb horns,
(ii) bicycle helmets that conform to European product safety standard CEN/EN 1078,
(iii) bicycle lights, including dynamo packs,
(iv) bicycle reflectors and reflective clothing, and
(v) such other safety equipment as the Revenue Commissioners may allow;
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“cargo bicycle” means a bicycle with a special purpose frame which has been designed to carry large or heavy loads, or passengers other than the rider, by means of a bulk storage capacity container or platform integrated into, or affixed to, the frame of the bicycle, in front of or behind the rider;
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“normal place of work” means the place where the director or employee normally performs the duties of his or her office or employment;
“pedal cycle” means—
(i) a bicycle or tricycle which is intended or adapted for propulsion solely by the physical exertions of a person or persons seated thereon, or
(ii) a pedelec,
but does not include a moped or a scooter;
“pedelec” means a bicycle or tricycle which is equipped with an auxiliary electric motor having a maximum continuous rated power of 0.25 kilowatts, of which output is progressively reduced and finally cut off as the vehicle reaches a speed of 25 kilometres per hour, or sooner if the cyclist stops pedalling;
“qualifying journey”, in relation to a director or employee, means the whole or part of a journey—
(i) between the director’s or employee’s home and normal place of work, or
(ii) between the director’s or employee’s normal place of work and another place of work, where the director or employee is travelling in the performance of the duties of his or her office or employment.
(c) A director or employee shall not, by virtue of this subsection, be relieved from a charge to income tax under subsection (1) more than once in any period of [12]>5<[12][12]>4<[12] consecutive years of assessment, commencing with the year of assessment in which the director or employee concerned is first provided with a bicycle or bicycle safety equipment.
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(d) Notwithstanding paragraph (a), where the expense or part thereof, as the case may be, is in connection with the provision of a pedelec, the amount referred to in paragraph (a) shall be €1,500.
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(e) Notwithstanding paragraphs (a) and (d), where the expense or part thereof, as the case may be, is in connection with the provision of a cargo bicycle, the amount referred to in paragraph (a) shall be €3,000.
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(5H) Subsection (1) shall not apply to expense incurred by the body corporate in, or in connection with, the provision, for a director or employee, in any of its business premises, of a facility for the electric charging of vehicles, where all the employees and directors of that body corporate can avail of the facility.
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(5I) (a) Subject to paragraph (b), subsection (1) shall not apply to expense incurred by the body corporate in or in connection with the provision for a director or employee of a qualifying medical checkup, where—
(i) qualifying medical check-ups are made available generally by the body corporate to all directors and employees of that body corporate, or
(ii) the director or employee is required by the terms of his or her office or employment to undergo the qualifying medical checkup.
(b) A director or employee shall not, by virtue of this subsection, be relieved from a charge to income tax under subsection (1) more than once in any year of assessment, unless subparagraph (ii) of paragraph (a) applies.
(c) In this subsection—
“medical practitioner” means a person who is registered in the register established under section 43 of the Medical Practitioners Act 2007;
“qualifying medical check-up” means a medical examination carried out by a medical practitioner to test a person’s state of health.
(5J) (a) Subsection (1) shall not apply to health expenses incurred by the body corporate in or in connection with the provision for a director or employee of health care, where health care is made available generally by the body corporate to all directors and employees of that body corporate.
(b) In this subsection, “health care” and “health expenses” have the same meanings respectively as they have in section 469.
(5K) (a) Subsection (1) shall not apply to expense incurred by the body corporate in or in connection with the provision for a director or employee of a Covid-19 test where—
(i) the test is necessary for the performance of the duties of the office or employment of the director or employee, and
(ii) Covid-19 tests are made available by the body corporate to all directors and employees of that body corporate where necessary for the performance of the duties of the office or employment of those directors and employees.
(b) In this subsection—
“Covid-19” means a disease caused by infection with the virus SARS-CoV-2 and specified as an infectious disease in accordance with Regulation 6 of, and the Schedule to, the Infectious Diseases Regulations 1981 (S.I. No. 390 of 1981) or any variant of the disease so specified as an infectious disease in those Regulations;
“Covid-19 test” means a relevant test, administered in accordance with the instructions of the manufacturer of the test, the purpose of which is to detect the presence of Covid-19 in the person to whom the test is administered;
“rapid antigen test” means a test that relies on detection of viral proteins (antigens) using a lateral flow immunoassay that gives results in less than 30 minutes;
“relevant test” means—
(a) an RT-PCR test,
(b) a rapid antigen test of a kind—
(i) included, for the time being, in the common list of Covid-19 rapid antigen tests agreed in accordance with the Council Recommendation of 21 January 20211, and
(ii) that complies with the requirements of Directive 98/79/EC of the European Parliament and of the Council of 27 October 19982 or, as appropriate, Regulation (EU) 2017/746 of the European Parliament and of the Council of 5 April 20173,
or
(c) a rapid antigen test of a kind that complies with regulatory requirements under the laws of a state other than a Member State that are equivalent to the requirements referred to in paragraph (b)(ii);
“RT-PCR test” means a reverse transcription polymerase chain reaction test.
(5L) (a) Subsection (1) shall not apply to expense incurred by the body corporate, or incurred by a director or employee and reimbursed by the body corporate, in or in connection with the provision for a director or employee of an influenza vaccine, where influenza vaccines are made available generally by the body corporate to all directors and employees of that body corporate.
(b) In this subsection, ‘influenza vaccine’ means an influenza vaccine specified in column 1 of the Eighth Schedule to the Medicinal Products (Prescription and Control of Supply) Regulations 2003 (S.I. No. 540 of 2003) and administered in accordance with the requirements specified in columns 2 to 6 of that Schedule opposite the mention of the product concerned.
(c) Relief shall not be given under section 469 in respect of the expense referred to in paragraph (a) incurred by a director or employee and reimbursed by the body corporate.
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(6) Any reference in this section to expense incurred in or in connection with any matter includes a reference to a proper proportion of any expense incurred partly in or in connection with that matter.
(7) Where expense is incurred by a person connected with a body corporate, being expense which if incurred by the body corporate would be expense of the kind mentioned in subsection (1)(a), the body corporate shall be deemed for the purposes of this section to have incurred the expense, and subsection (1) shall apply accordingly in relation to any person, being a director or employee of the body corporate, in respect of whom the expense was incurred.
(8) A person shall be regarded as connected with a body corporate for the purposes of subsection (7) if the person is—
(a) a trustee of a settlement (within the meaning of section 794) made by the body corporate, or
(b) a body corporate,
and would be regarded as connected with the body corporate for the purposes of section 10.
[1]
Inserted by FA99 s33. Applies as respects the year of assessment 1999-2000 and subsequent years of assessment.
[2]
Substituted by FA04 s8(1)(b). This section is deemed to have come into force and taken effect as on and from 1 January 2004.
[5]
Inserted by F(No.2)A08 s7(1)(a). Applies in respect of expense incurred on or after 1 January 2009.
[6]
Inserted by FA11 s7(1)(a). Deemed to have come into force and takes effect as on and from 1 January 2011.
[8]
Inserted by FA13 s13(b). Applies as respects the year of assessment 2013 and each subsequent year of assessment.
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Substituted by FA13 s13(c). Applies as respects the year of assessment 2013 and each subsequent year of assessment.