Company Car Tax Calculator

It depends on the car’s P11D value, its CO2 and fuel type, and your Income Tax rate. Multiply the P11D value by the Benefit-in-Kind percentage to get the taxable benefit, then apply your tax rate. For example, a £35,000 electric car (4% BIK) is a £1,400 benefit, so a higher-rate (40%) taxpayer pays about £560 a year, or roughly £47 a month. Enter your car above for your own figure.

Take the car’s P11D value (list price plus options), deduct any qualifying employee capital contribution up to £5,000, then multiply by the Benefit-in-Kind percentage set by CO2, fuel type and electric range. The calculator can either apply a simple 20%, 40% or 45% tax band, or add the benefit to your income for a more accurate estimate.

To encourage electric cars, the government keeps their Benefit-in-Kind rate very low — 4% in 2026/27, versus up to 37% for high-emission petrol and diesel cars. A £35,000 electric car is taxed on a £1,400 benefit, so a higher-rate taxpayer pays around £560 a year. The electric-car BIK rate rises to 5% in 2027/28, 7% in 2028/29 and 9% in 2029/30.

The P11D value is the car’s manufacturer list price including VAT, delivery and any optional extras — not the discounted price your employer actually paid. A qualifying one-off employee capital contribution is deducted separately, capped at £5,000.

No — as the employee you only pay Income Tax on the benefit. Your employer pays Class 1A National Insurance on it (15% in 2026/27), which is why a company car is part of the cost they weigh up too.

An electric company car can be tax-efficient because of its low Benefit-in-Kind rate, but the overall value also depends on the salary you sacrifice, pension and benefit effects, scheme fees, insurance, maintenance and what your alternative car would cost. For a high-emission petrol or diesel the Benefit-in-Kind can be expensive, so a car allowance or buying privately may work out better. Compare the tax here and read the salary sacrifice guide.