How to process benefits in kind and the use of a company car

What is it for?

Not everything the company gives the employee comes as money. A car for personal use is income in kind: tax is paid on an amount calculated by a rule. On this screen you assign the benefit, and the payslip shows the amount and its effect on Social Security and IRS.

When to use it?

• The company gives the employee a car also for personal use, with a written agreement.
• The company provides housing, goods or services.
• There is a one-off amount with an exemption limit: cashier's failure allowance, per diem abroad, meal allowance paid in cash and on card, car bought below market value, insurance and options (Income in kind).

Do not use this screen for telework: it has Telework agreements, in People › Work time. Bonuses and commissions are not recorded here: see How to pay bonuses, commissions and other variable amounts.

Where to find it?

• Payroll › Prepare › Workers and contracts › Benefits in kind
• Payroll › Process › Wage assignments and income in kind › Income in kind
• Payroll › Configure › Pay item setup › Benefit rules (only the Payroll Administrator)

Before you start

• To assign the benefit and calculate the payslip, your profile is Payroll Processor or Payroll Administrator.
• The rule and the pay item must exist. The demo has those for health insurance, but not for the car. The Payroll Administrator creates them once:
  • in Benefit rules: Code VIATURA, Name, Type Company car for personal use, Valuation Company car (CIRS art. 24.º/5 and 7; CRC art. 46.º-A/4), Valid from, Version, Legal reference, IRS, Social Security, DMR code and Social Security code;
  • in Pay items: a pay item with Quantity source Benefit in kind (CIRS art. 24.º), the rule's code in Benefit rule and the Social Security code filled in from the start (see How to create and configure a pay item).
• You have the reference of the written agreement, the car's market value on 1 January and the acquisition cost.

How to use it

Assigning a car

1. Open Payroll › Prepare › Workers and contracts › Benefits in kind and click New.
2. In Worker, choose the employee, for example Ana Margarida Pinto. In Benefit rule, choose the rule: Type and Valuation are filled in automatically.
3. In From, enter 01/11/2026. Leave Up to empty while the car is assigned.
4. Enter Market value on 1 January (car), 24000, Acquisition cost (car), 30000, and Written agreement of personal use (car), Acordo de viatura 1/2026. Confirm the option for Why is the car for personal use?. Save.
5. Open the month's payslip in Payroll › Process › Payslips and click Calculate. The line for the Car for personal use pay item is added automatically.

Recording an occurrence

The pay item takes the occurrence to the payslip. The Payroll Administrator creates it once for each type, in Payroll › Configure › Pay item setup › Pay items: in Quantity source, they choose Income in kind (register of occurrences) and, in Kind of income in kind, the same type as the occurrence.

1. Open Payroll › Process › Wage assignments and income in kind › Income in kind and click New.

2. Choose Worker and Date, for example 15/11/2026.

3. In Type, choose one of the options. The fields to fill in change with the type:

   Type	What to fill in
   Per diem abroad	Country of the trip, Quantity and Amount paid
   Meal allowance paid in cash and on card	Quantity, Paid in money and Paid on card
   Car bought below the market value	Market value, Paid by the worker and Already taxed
   Cashier's failure allowance	Amount paid and Monthly fixed remuneration
   Life insurance, pension fund, PPR paid by the company	Benefit rule and Amount paid
   Options, securities and crypto assets	Benefit rule, Quantity, Market value, Paid by the worker and Source of the value

4. Save. The program calculates Income, Exempt (IRS), Taxable (IRS) and In the Social Security base, and explains the calculation in How it was calculated.

5. Open the month's payslip and click Calculate. The pay item's line is added automatically.

Car example. Ana earns 2,400.00 €. On the November 2026 payslip:

• Car for personal use for IRS: 0.75 % of 24,000.00 € = 180.00 €.
• Social Security (worker): 11 % of 2,625.00 € = 288.75 €. The base is 2,400.00 € plus 0.75 % of the acquisition cost: 0.75 % of 30,000.00 € = 225.00 €.
• IRS withheld: 85.00 €, unchanged. By default, IRS is not withheld on income in kind.

Cashier's failure allowance example. Diogo Ferreira Lopes, with 1,150.00 € of fixed remuneration and an allowance of 120.00 €: 5 % limit = 57.50 € exempt and 62.50 € taxable. The payslip's Social Security becomes 11 % of 1,212.50 € = 133.38 €.

To post the batch, each pay item needs a posting template: without it, the batch responds “Posting blocked: 1 pay item(s) with a value have no posting template on 30/11/2026: Car for personal use.”. Assigning the benefit or recording the occurrence does not create journal entries.

Pending validation by a certified accountant: which of the two car values Social Security uses, the taxation of the cashier's failure allowance, the DMR and Social Security codes, and the accounts.

Expected result

• The Benefits in kind list shows the assignment, which applies from From to Up to.
• The payslip shows the line with the amount. Exempt part and Taxable excess are optional columns in the list.
• The occurrence shows Income, Exempt (IRS), Taxable (IRS), In the Social Security base and How it was calculated.

Important notes

• The car is not money handed over. The payslip shows it in Benefits in kind (not paid in cash) and does not add it to the Net pay. In the example: 2,709.15 € − 373.75 € − 180.00 € = 2,155.40 €.
• A rule in use cannot be changed. The record says: “This record is already in use, so it can no longer be changed. To change it, close the period (fill in “Valid until”) and register a new one with its start date.”
• Insurance, pension funds, PPR and options need a rule created by the company. fiscaldoo assumes nothing.

Common problems

“The failure allowance needs the fixed monthly remuneration of the worker”

• Message: “The failure allowance needs the fixed monthly remuneration of the worker. What happened: the exempt limit is a percentage of it. How to fix it: fill in “Monthly fixed remuneration”.”
• Cause: that field was missing when the occurrence was saved.
• What to do: fill in Monthly fixed remuneration and save.

“Some required fields are empty”

• Message: “Some required fields are empty. Fill in the fields marked in red to be able to save.”
• Cause: for the car, the Written agreement of personal use (car) is required, and typing only spaces does not count.
• What to do: enter the reference of the agreement and save.

“The batch … cannot be validated: “VIATURA” (…)”

• Message: “The batch “Salários de novembro de 2026” cannot be validated: “VIATURA” (Ana Margarida Pinto). What happened: a pay item subject to Social Security with a value has no Social Security code and the declaration would be wrong. …”
• What to do: the version of the pay item that has already started can no longer be changed: “The version(s) of “VIATURA” already started (from 2026-01-01) and cannot be edited: history is never rewritten. …”. Ask the Payroll Administrator to close the version with Valid until and create another one with the Social Security code. Then click Calculate on the payslip.

“The benefit rule … has no version in force”

• Message: “The benefit rule “HABITACAO” has no version in force on 30/11/2026. What happened: the benefit cannot be classified without it and nothing is assumed. How to fix it: register the version (Payroll › Configure › Pay item setup › Benefit rules).”
• What to do: ask the Payroll Administrator to create the rule with the same code as the pay item and with Valid from earlier than the period.

“The payslip … cannot be validated: something recorded for the worker would remain unpaid”

• Message: “The payslip “Diogo Ferreira Lopes (01/11/2026 — 30/11/2026)” cannot be validated: something recorded for the worker would remain unpaid (income in kind of 15/11/2026 (Cashier's failure allowance): 120.00 €). What happened: there is no pay item in force to carry it. …”
• What to do: ask the Payroll Administrator to create the pay item in Payroll › Configure › Pay item setup › Pay items. For a benefit with a rule, with the same rule. For an occurrence, with the source Income in kind (register of occurrences) and, in Kind of income in kind, the occurrence's type. Then click Calculate again.

“A legal or collective-agreement version needs its reference”

• Message: “A legal or collective-agreement version needs its reference. Fill in “Legal reference” (diploma/article or agreement and publication).”
• Cause: when saving the pay item, Source type was left on Legal rule, which is the default option, and Legal reference is empty.
• What to do: fill in Legal reference. If the pay item is an internal rule, choose Company rule in Source type.

“The pay item … is “To be decided” in “Enters Christmas allowance””

• Message: “The pay item “VIATURA” is “To be decided” in “Enters Christmas allowance”. What happened: whether or not it enters the base is a decision (CT art. 264.º) and none has been taken, so nothing is guessed. …”
• What to do: decide with the certified accountant whether the pay item is included and choose Yes or No in the inclusion settings. If the version has already started, close it with Valid until and create a new one: a version that has started cannot be changed.