Supreme Court in tax case: iPad is a computer

The Supreme Court has ruled that the iPad is a computer for tax purposes and not a ‘communication tool’. It can be concluded from the wording of the court that this applies to all tablets. Companies can then no longer provide tablets to employees tax-free.

From a tax point of view, the iPad is a computer according to the Supreme Court because in the explanation of the old rules for reimbursements and benefits in the Wage Tax Act, it was stated that electronic equipment is also regarded as a computer if it is “wholly or partly intended for tasks that can also be performed with a computer”. Digital diaries, mini-notebooks and GPS equipment are mentioned as examples.

Last year, the court found iPads and comparable tablets still means of communication. Due to the screen size and input options, the iPad could only be used as a computer to a limited extent, according to the judgment at the time. However, the Supreme Court has now confirmed an earlier court decision, in which iPads were regarded as computers.

As a result of the decision in cassation, an iPad could not simply be provided by employers free of payroll tax: the tablets had to be used at least 90 percent for business purposes. If the Supreme Court had considered iPads as a means of communication, it would have been only 10 percent. Companies can now invoke the ‘necessity criterion’ in the work-related costs scheme if they believe that personnel need tablets. The distinction between computer and means of communication is therefore no longer important. The old rules have expired in 2011.

RTL had filed a lawsuit because it had to pay 325,000 euros in payroll tax from the Tax Authorities on 664 iPads that the company had provided its employees tax-free.