Why is health insurance taxed?

Pooinloo wrote: »

If an employer is nice enough to provide health insurance, why should an employee pay tax on that? Shouldn't employer's covering health insurance be encouraged?

Health insurance has a monetary value, therefore it's taxed same as any other payment that has a monetary value (with some small exceptions)

Another scrounger thread

You can claim tax relief on it. €1000 per adult and €500 per child

There was a time when the BIK tax was fully offset by the medical insurance tax relief (which was at whatever rate you paid). The socialists successfully lobbied against that saying it was unfair on those who only paid tax at standard rate so the relief was reduced to 20%. They've been lobbying for the same for pension tax relief, thankfully no success there so far.

Pooinloo wrote: »

Nope it's 20% of 1000 per adult, and 20% of 500 per child.

That’s what I meant sorry.

Pooinloo wrote: »

Of course it is, but you're completely ignoring the point of a person having something purchased for them, and then being penalised.

And you’re ignoring the point that it’s no different than your employer giving you the money to purchase it yourself.

Pooinloo wrote: »

So by that logic, shouldn't we be taxed on stationary, food or other perks that a company might provide?

It's different because someone said so!

We aren't the worst country for taxation, but it's little consolation when you live here and not Zambia.

The more encompassing, intricate and complex taxation becomes, the more it encourages ducking, dodging, weaving and plain cash dealing.

Where they get you by the twiddly bits is the area of essentials like health care and provision. But even so, stay floating like a butterfly

starbaby2003 wrote:

That’s what I meant sorry.

I forgive you.

Pooinloo wrote: »

That's not necessarily true, you pay alot of tax for a company car, which is only given if it's needed for work.

If you only use it for work- I.e. don’t take it home with you, then there’s no tax on it.

Pooinloo wrote: »

If an employer is nice enough to provide health insurance, why should an employee pay tax on that? Shouldn't employer's covering health insurance be encouraged?

How does it not encourage an employer to provide it? The employer doesn't pay the tax.

If an employee decides to not avail of the benefit, they'll most likely still pay a lot more to buy private health insurance themselves.

It's a win-win for the employer, they get to offer insurance which is generally an expected benefit from prospective employees. For those employees that don't want to avail of it that's fine too.

Pooinloo wrote: »

Nope it's 20% of 1000 per adult, and 20% of 500 per child.

If your employer is paying your insurance on your behalf (on pay slip) then do you automatically get relief and it’s factored in or do you need to claim it separately?

Pooinloo wrote: »

Yup, and the taxation rates are extortionate. For example if you drive 24000 in a €30000 car, you'll be liable for around 10k on the year.

No - if the business mileage is less than 24k km p.a. AND the car is available throughout the year for personal use also AND all running costs associated with the car are paid by the business, then the taxable benefit would be €10k, and the tax liability would be a max of €5,200.

If you do more 24000km for business purposes then the BIK assessable is reduced further.

Either way - tax is only liable if the car is also available for personal use - and €5200 is the guaranteed annual cost. No fuel to pay for, no insurance, tax or maintenance. And of course, not having to pay to buy the car in the first place.

Had a company car for nearly 10 years, absolute bargain compared to having to own and pay for one myself