| Set up a benefit in kind (BIK) payment |
Description | A Benefit in kind (BIK) is any employee remuneration, which isn't part of their normal pay and which you process through the payroll. Include BIK on an employee's payslip for tax, PRSI and USC calculations, without paying the BIK amount to the employee, this is notional pay. NOTE: Calculate tax, USC and PRSI on actual pay + notional pay. However, the employee only receives actual pay through the payroll. Assume the employee received the BIK outside of payroll, such as through private use of a company car. |
Resolution | Set up a BIK payment- On the menu bar, click Company/Payroll then click Payments.
- Click New, then set up the BIK payment as follows:
Title | Enter the name of the payment, for example, BIK Car. | Type | Click Benefit In Kind. | BIK Type | Click one of the following options:
- Company Car
NOTE: The Finance Bill 2023 announces a temporary €10,000 relief on the Original Market Value (OMV) of some vehicles for tax calculation. Find out more about the Car BIK Taxation changes on the gov.ie website. - Medical Insurance
- Staff Housing
- Other
| Pay as Nett | If you want to pay the tax, PRSI and USC on the benefit in kind for your employees, select this check box. | Universal Social Charge | If the payment is subject to universal social charge (USC), select this check box. | Include in pension calculation | If the payment is subject to calculation, select this check box. | Apply Pension Related Deduction | If the payment is subject to pension related deduction (PRD), select this check box. | Factor | Ignore this option. | Multiply by the number of holiday periods | Select this checkbox to adjust the payment value based on the number of holiday periods entered on the employee's timesheet. NOTE: This option is only available in weekly and fortnightly payrolls.
| Formula | Ignore this option. |
- Click Save, then click Close.
Assign a BIK payment to an employeeThere are two different ways you can enter a BIK payment amount for an employee in Sage Payroll. The one you use depends on whether the BIK value stays the same each period or not.
If the BIK amount stays the same each pay period- On the menu bar, click Processing then click Employee Details.
- Next to the Surname box, click browse and click the relevant employee.
- Click the Payments tab.
- Locate the BIK payment, then enter it's value in the Std. Amount column.
TIP: If you know the total amount of the BIK, work out the amount you want to deduct each period and enter this figure. - Click Save, then click Cancel.
NOTE: If the BIK amount doesn't appear when you're processing the employees' pay details, delete the timesheet and re-open it. The BIK amount now appears automatically and you can save the timesheet.
If the BIK amount fluctuates from period to period- On the menu bar, click Processing then click Time and Pay.
- Under Entry mode, select Random then click Continue.
- Next to the Employee box, click browse and click the relevant employee.
- On the Data Entry tab, locate the BIK payment and enter it's value in the Hrs/Val column.
- Enter the rest of the employee's pay details as normal, then click Save and Cancel.
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