Written by Pat Boyle.
This article first appeared in the Irish Independent on 04 April 2006.
The average value of cars offered by companies to senior managers is €40,759, a survey from PricewaterhouseCoopers (PwC) revealed yesterday.
The PwC survey also said that as a result of new tax rules many firms are moving away from straightforward car perks and are now offering managers cash alternatives, with the survey finding that the average annual cash alternative by way of a car allowance offered to middle managers stands at €10,332.
Mark Carter, a partner with PwC said that many businesses have changed their company car policy since 2004.
“The change has been primarily driven by the new employee benefit tax (BIK) rules introduced two years ago,” he explained.
Apart from tax changes, other factors which have caused employers to change arrangements in recent years include the increased administrative demands caused by the introduction of employee benefit withholding tax.
Employees are also demanding greater benefit flexibility while pressure on HR departments to achieve cost savings is another factor driving the change.
PwC said that about 40pc of organisations indicated that they are reviewing their car benefit policy or are planning changes in 2006.
Irish Independent, 4 th April 2006
Pat Boyle
