Company Car Tax 2026/27
Company car tax (Benefit-in-Kind or BIK) is charged on the value of having a company car available for private use.
BIK Tax Calculation
BIK Tax = P11D Value × BIK Rate × Your Tax Rate
BIK Rates 2026/27 by CO2
| CO2 (g/km) | BIK Rate |
|---|---|
| 0 (Electric) | 3% |
| 1-50 (Electric range 130+ miles) | 3% |
| 1-50 (Electric range 70-129) | 5% |
| 1-50 (Electric range 40-69) | 8% |
| 1-50 (Electric range 30-39) | 12% |
| 1-50 (Electric range <30) | 14% |
| 51-54 | 15% |
| 55-59 | 16% |
| 60-64 | 17% |
| 65-69 | 18% |
| 70-74 | 19% |
| ... | ... |
| 170+ | 37% |
Electric Car Example
Tesla Model 3 (P11D £42,000)
| Component | Value |
|---|---|
| P11D value | £42,000 |
| BIK rate | 3% |
| BIK value | £1,260 |
| Tax (40%) | £504/year |
Just £42/month for a Tesla!
Diesel Car Example
BMW 3 Series diesel (P11D £40,000, 130g/km CO2)
| Component | Value |
|---|---|
| P11D value | £40,000 |
| BIK rate | 33% |
| BIK value | £13,200 |
| Tax (40%) | £5,280/year |
£440/month - over 10x the electric car!
Company Car vs Cash Allowance
| Factor | Company Car | Cash Allowance |
|---|---|---|
| Tax efficiency (EV) | Excellent | Taxed as income |
| Insurance | Usually included | You arrange |
| Maintenance | Usually included | You pay |
| Flexibility | Limited choice | Any car |
Related Calculators
- Company Car Calculator - Calculate your BIK
- EV Salary Sacrifice Calculator - EV options