Is there a way to give someone a bonus that they won't pay tax on?

garybaldy

My boss has said he would like to give me a bonus of 1k. I'm delighted naturally. But having just worked out that it will net me €560 I'm a bit deflated. Is there any other way of him giving me this without it being taxed? or taxed so much?? Thanks.

AndyBoBandy

I guess if it could be given to you in the form of an expense, or per diem payment,
but I wouldn't be sure about the legality of that.

in fact,
I paid about €3,000 tax on my bonus this year, so, pay your taxes like everyone else!!

handlemaster

voulchers used to be a way up to 300 euro i think

xabi

you could get 250 in vouchers tax free. one4all or Bonus Bonds are a good option.

sabat

Maybe get you a nice laptop or other expensive electronics that could look like they're related to work in some way? It works out cheaper for him too because he'll get the VAT back and won't have to pay employers prsi.

bigpink

Ask for cash?

garybaldy

Thanks. I might mention the vouchers option and take the hit on the rest. I do understand it has to be legal, but salary isn't huge and pay more than enough tax as it is! so any option to claw back a bit more for myself is good. I just wondered if there was some creative yet legal way around it :-)

JustTheOne

garybaldy wrote: »

Thanks. I might mention the vouchers option and take the hit on the rest. I do understand it has to be legal, but salary isn't huge and pay more than enough tax as it is! so any option to claw back a bit more for myself is good. I just wondered if there was some creative yet legal way around it :-)

Just pay your taxes like everyone else and the law says.

That's life unfortunately.

seamus

sabat wrote: »

Maybe get you a nice laptop or other expensive electronics that could look like they're related to work in some way? It works out cheaper for him too because he'll get the VAT back and won't have to pay employers prsi.

http://www.revenue.ie/en/tax/it/leaflets/benefit-in-kind/free-use-assets.html

Basically it means that in year one, a €1,000 laptop will cost you about €25 in tax (notional pay of €50). This can then be depreciated over the next five years, so the BIK payable reduces every year. At the end of the five years your employer could then choose to dispose of the asset, to you, at a nominal cost with no tax implications for you.

However, this is a pretty annoying calculation. Your employer could just supply you with a €1,000 laptop "for work purposes" on which you do not have to pay any tax. At the end of the five year period or if you choose to leave, they can dispose of the asset to you.

Arbiter of Good Taste

garybaldy wrote: »

Thanks. I might mention the vouchers option and take the hit on the rest. I do understand it has to be legal, but salary isn't huge and pay more than enough tax as it is! so any option to claw back a bit more for myself is good. I just wondered if there was some creative yet legal way around it :-)

No you don't pay more than enough tax. You pay the right amount of tax. No one likes paying tax, but it's a fact of life

DaeryssaOne

garybaldy wrote: »

Thanks. I might mention the vouchers option and take the hit on the rest. I do understand it has to be legal, but salary isn't huge and pay more than enough tax as it is! so any option to claw back a bit more for myself is good. I just wondered if there was some creative yet legal way around it :-)

This won't work either. If you were to receive a voucher only (up to a value of 250) this can be given tax free. If there is also a cash payment with the voucher, the entire amount becomes fully taxable. I'm afraid you just have to suck it up and pay the tax.

garybaldy

Thanks for the clarification jobr, and the reality check JustTheOne and Arbiter :-)

Schrodingercat

You could get a 1000 euro bike under the bike to work scheme without a salary deduction.
Or your annual bus / train ticket.

relax carry on

Are you earning over 33800 euro annually?

dearg lady

Schrodingercat wrote: »

You could get a 1000 euro bike under the bike to work scheme without a salary deduction.
Or your annual bus / train ticket.

This would be taxable as BIK

Schrodingercat

dearg lady wrote: »

This would be taxable as BIK

The bike to work scheme allows your employer pay for a bike up to the value of 1000 euro without any bik. Most companies deduct the 1000 euro from your gross salary but they don't have to.

Taxsaver.ie. has the details for the bus/train ticket

dearg lady

Schrodingercat wrote: »

The bike to work scheme allows your employer pay for a bike up to the value of 1000 euro without any bik. Most companies deduct the 1000 euro from your gross salary but they don't have to.

Taxsaver.ie. has the details for the bus/train ticket

ha, thanks, I missed a question mark!

viztopia

Classic!

garybaldy wrote: »

My boss has said he would like to give me a bonus of 1k. I'm delighted naturally. But having just worked out that it will net me €560 I'm a bit deflated. Is there any other way of him giving me this without it being taxed? or taxed so much?? Thanks.