Unusually with such a change in taxation, the rules are retrospective in that they do not apply only to people receiving a new company car from this year on. If you received a company car before this year under the old regime and still use it, you will be taxed under the new regime from this year on.
Under intense lobbying, the Government backed down partially – for this year at any rate. In March, the announced that a special discount on the OMV of €10,000 would be put in place for this year to calculate your BIK for vehicles in categories A-D. The least environmentally-friendly cars – those in category E – got no such respite.
So, for this year, going back to our example, our category C company car worth with an original OMV of €35,000 and doing 45,000 kilometres a year will be assessed as yielding BIK this year of €4,500 . That’s much closer to the €4,200 BIK assessed under the old regime and well short of the €6,300 you were facing under the original structure.
It remains to be seen whether the amended regime continues into next year or whether they move back to the original proposal or introduce additional phasing in.