Taxpayers can claim a tax deduction of 150% of the costs incurred for the transportation of employees to and from the place of work.
Through Legal Notice 67, new Rules were introduced in February 2018 allowing taxpayers to claim a tax deduction of 150% of the costs incurred for the transportation of employees to and from the place of work using vehicles capable of carrying more than 8 persons.
The deduction may be claimed on the lower of €25,000 of the transportation costs or €300 per employee whose transportation costs have been incurred by their employer.
Such tax incentive is currently open for years of assessment 2018 to 2020 i.e. basis years 2017 to 2019.
In essence, employers incurring transportation costs for less than 84 employees would be eligible to claim a deduction on a maximum cost of €300 per employee, while when the relevant employee number exceeds 83, the claim could be made on a maximum cost of €25,000.
Such new Rules follow the statement made by the Minister of Finance in his 2017 Budget Speech through which he announced the introduction of tax credits for worker transport as a measure aimed at reducing road traffic congestion and contributing towards a cleaner environment.
If you would like to know more about this development and how it might affect your business, or indeed to discuss any other tax matter, please get in touch with your contact at KPMG.
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