Health insurance as BIK

bonjurkes

My health insurance is paid by my employer and I am obliged the pay taxes, and it appears as BIK YTD on my payroll around €1200 at the end of the year (so €110 something for each month). And I get €200 back when I fill my tax form at the end of the year.


I was wondering would it make any difference (to my advantage) if I choose and pay for my own health insurance? By that way I can decide which health insurance package I want etc. Or is it better that my employer pays for it?


Can't I get this €200 back at my tax form (Form 11) if I pay it for myself? Does it actually make any difference if I pay directly for the health insurance or if I only the taxes?


When I check the price of my health insurance, it's same (or similar) to the price that is listed on the health insurance website.


Thanks

amcalester

It’s better that your employer pays it. It’s a credit on your payslip, take it away and after you pay it yourself you’ll have less cash.

bonjurkes

If I pay it by myself, can't I claim it as expense on Form 11 at the end of the year?

amcalester

bonjurkes wrote: »

If I pay it by myself, can't I claim it as expense on Form 11 at the end of the year?

Yes, but the tax credit is capped at €200 which you’re already getting.

At the minute your health insurance is costing you the BIK on the monthly premium and you get €200 back each year.

Pay it yourself and you have to pay the same premium from your net salary and then get the same €200 back at the end of the year (or it’ll be built into the premium already).

The first option is cheaper for you.

bonjurkes

Well still I didn't really understand how it works but I will leave it as it is. Thank you!

amcalester

I’ve added a bit of an explanation above.

TiGeR KiNgS

bonjurkes wrote: »

If I pay it by myself, can't I claim it as expense on Form 11 at the end of the year?

No, Health insurance is not tax deductible on your personal tax return.

relax carry on

bonjurkes wrote: »

If I pay it by myself, can't I claim it as expense on Form 11 at the end of the year?

No as tax relief is granted at source for medical insurance premiums paid by individuals.

Tow

If you want better cover talk to your employer. Most allow will allow for extra payments to cover spouse, children, better cover etc. The additional cost is not paid by the employer, but comes out of your pay as a net deduction.