Revenue eBrief 253/25: Key Employer-Provided Vehicle Tax Updates

Revenue has issued eBrief No. 253/25, outlining updates to the tax treatment of employer-provided vehicles following the Finance Act 2025. The changes apply mainly from 2026 onwards and are relevant for employers, payroll teams, and tax advisors.

Key points include:

Extension of OMV Relief:

The temporary reduction to the Original Market Value (OMV) used to calculate Benefit-in-Kind (BIK) on company cars has been extended to cover the 2026–2028 tax years.

New Zero-Emission Category (A1):

From 1 January 2026, a new A1 category applies to zero-CO₂ emission vehicles, supporting the move towards electric company cars.

Mileage Band Change:

The lower limit of the highest business mileage band has been permanently reduced to 48,001km, impacting BIK calculations for high-mileage vehicles.

Home Charger BIK Clarification:

Revenue has provided further clarity on the BIK exemption where employers install electric vehicle home chargers for employees or directors.

These updates mean employers should review company car policies and ensure payroll systems are ready for the new rules ahead of 2026.

If you would like advice on how these changes may affect your business or employees, please contact our team.