The distinction between a communication device and a computer is relevant for tax purposes due to the different conditions for tax exempt allowances and benefits in kinds granted by an employer.

The conditions are as follows:

Communication device? → Business use must be at least 10%

Computer? → Business use must be at least 90%

iPads are frequently provided to employees. The State Secretary of Finance's Decree of 5 July 2011 sets out the tax conditions for a communication device. A device is deemed to be a communication device if:

  • It has a display screen smaller than 7 inches;
  • It is primarily used for communication; and
  • It has the external features of a mobile telephone.

As a result of the above, an iPad can be provided tax-free if it is used for at least 90% for business purposes.

The Court of Haarlem confirmed this by ruling on 30 November 2012, in which the Court provided that an iPad must be regarded for tax purposes as a (small) computer and that the employer must provide evidence of the 90% business use. The Court considered that given the many other possibilities for use, the iPad's communication function did not play a dominant role.

We advise employers to record the use of an iPad in an user agreement. If the employee has used the iPad privately for more than 10%, the employer is then able to recover any additional assessment of statutory payroll levies from the employee.