Company Car Tax Calculator
Calculate your Benefit in Kind (BIK) tax on a company car for the 2025/26 tax year. See how much tax you will pay based on the car's list price, CO2 emissions and fuel type.
Car Details
P11D value including options, excluding first registration fee and road tax
Check your V5C document or the manufacturer's specifications
If your employer pays for fuel used for private journeys
Your Tax Details
Your marginal income tax rate
Annual Tax on Company Car
£2,030.00
Based on 29% BIK rate
Monthly Tax Cost
£169.17
Deducted from your pay
BIK Percentage
29%
Based on CO2 emissions
BIK Taxable Value
£10,150.00
29% of £35,000.00
Salary Equivalent Comparison
How much gross salary you would need to earn to cover the same car cost privately
As a Company Car
£2,030.00
annual cost to you
Equivalent Salary Needed
£14,097.22
gross salary to fund equivalent car privately
Employer NI Cost
£1,522.50
Your employer pays 15% NI on the £10,150.00 BIK value
This calculator is for informational purposes only and does not constitute financial advice. Tax calculations are based on current HMRC rates and may not reflect your exact circumstances. Always consult a qualified financial adviser.
How Company Car Tax (BIK) Works in the UK
If your employer provides you with a company car that you can use for private journeys, it is classed as a Benefit in Kind (BIK) and you must pay tax on it. The amount of tax depends on the car's list price (known as the P11D value), its CO2 emissions and your personal tax rate. HMRC publishes BIK percentage tables each year, with rates ranging from just 2% for fully electric vehicles to 37% for the highest-polluting cars.
The taxable value of your company car is calculated by multiplying the P11D value by the appropriate BIK percentage. You then pay income tax on this amount at your marginal rate (20%, 40% or 45%). Diesel cars face an additional 4% surcharge on their BIK percentage, capped at 37%. If your employer also pays for fuel used on private journeys, you will face a separate fuel benefit charge based on a flat multiplier of £27,800.00 for 2025/26.
Electric company cars remain highly tax-efficient at just 2% BIK, making them significantly cheaper than petrol or diesel alternatives. For a £35,000.00 electric car, the annual BIK value is just £700.00, costing a basic rate taxpayer only £140.00 per year in tax. Your employer also benefits, as they pay Class 1A National Insurance at 15% on the BIK value. Use the calculator above to compare the tax cost of different vehicles and fuel types.
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Compare Electric Car LeasesLease terms and availability may vary. BIK rates are subject to change. Always confirm current rates with HMRC.