UK Company Car Tax (BIK) Calculator: Electric, Hybrid & Petrol Rates
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Company Car Tax & BIK Calculator
✓ Updated for HMRC 2026/27 Rates
Quick Select Vehicle Presets:
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Vehicle & Driver Details
£
Includes options, VAT & delivery; excludes 1st year VED & registration fee.
g/km
£
Directly reduces taxable P11D value by up to £5,000.
£
Adds HMRC Fuel Benefit (£28,200 × BIK %).
£
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2026/27 BIK Rules: Pure EVs are taxed at only 3% BIK. Petrol & diesel cars range from 15% up to 37%. Benefit values are collected automatically via your PAYE tax code.
Company car tax is calculated as a Benefit in Kind (BIK). To find the taxable value, you multiply the car’s list price (known as the P11D value, which includes options, VAT, and delivery charges but excludes road tax) by a BIK percentage that is determined by the car’s CO2 emissions. This BIK value represents the benefit’s taxable worth. Your employer reports this on a P11D form, and you pay tax on this value at your marginal personal income tax bracket (20% basic, 40% higher, or 45% additional rate). For example, if a car has a P11D value of £30,000 and a BIK band of 20%, the BIK value is £6,000. A higher-rate (40%) taxpayer will pay £2,400 per year in tax (£200 per month deducted from their tax code).
Why are electric vehicles (EVs) highly tax-efficient company cars?
HMRC applies extremely low BIK rates to zero-emission electric vehicles to encourage businesses to transition to green fleets. For the 2026/27 tax year, the BIK rate for pure electric cars is set at just 2% to 3%. This means a £50,000 electric company car has a BIK value of only £1,000. A higher-rate (40%) taxpayer will pay a mere £400 in tax per year (£33.33 per month) to drive a brand-new EV. In contrast, standard petrol or diesel cars can face BIK bands up to 37% based on their CO2 output, costing the same taxpayer over £7,000 in tax annually. Furthermore, companies can deduct 100% of the cost of new electric vehicles against their profits in the first year using capital allowances.