Choosing a company car? See what it could really cost you in tax.
Use our BIK calculator to estimate your monthly Benefit-in-Kind bill in a few simple steps.
A company car is a useful perk. But if it is available for personal journeys — including your usual commute — HMRC normally treats it as a taxable benefit. BIK tax is the Income Tax you pay on that benefit.
Start your BIK calculator estimate with the car’s original list price, including VAT, delivery and taxable options. A dealer discount or a low second-hand purchase price does not usually lower this figure. Exclude the first registration fee and vehicle tax.
The tax year, certified CO₂ emissions and, for low-emission cars, electric range set the percentage. A non-RDE2 diesel can attract a supplement. The badge on the bonnet does not set the rate.
The taxable benefit is added to your income. Our BIK tax calculator applies your selected rate to estimate the cost. Scotland has different Income Tax bands, so choose the right region in the BIK calculator first.
A quick BIK calculator example. Imagine you are comparing two cars over a coffee. A £40,000 electric car at 4% creates a £1,600 benefit in 2026/27. At 40% Income Tax, that is £640 a year, or about £53.33 a month. Suddenly, the shortlist feels a little easier.
If the benefit crosses a tax band, reduces your Personal Allowance or affects other income-based charges, a single-rate estimate can understate or overstate your bill. Check your full income position with payroll or an adviser before relying on a BIK calculator result. This is not a general take-home-pay tax calculator.
Lower emissions can mean a smaller taxable benefit. For cars emitting 1–50 g/km, the certified electric-only range matters too. A plug-in hybrid is not automatically taxed like a pure electric car. Some newer plug-in hybrids qualify for temporary 1 g/km treatment under HMRC’s emissions rules. The BIK calculator includes an eligibility checkbox when you select a hybrid with recorded emissions above 50 g/km.
Use this BIK rate calculator with the exact figures on your vehicle documentation. Brochure ranges and a different wheel or trim specification may give you the wrong answer.
Source: HMRC appropriate percentage tables.
| CO₂ emissions | Electric range | BIK rate |
|---|---|---|
| 0 g/km — pure electric | Any | 4% |
| 1–50 g/km | 130+ miles | 4% |
| 1–50 g/km | 70–129 miles | 7% |
| 1–50 g/km | 40–69 miles | 10% |
| 1–50 g/km | 30–39 miles | 14% |
| 1–50 g/km | Under 30 miles | 16% |
| 51–54 g/km | Not applicable | 17% |
| 155+ g/km | Not applicable | 37% |
| CO₂ g/km | 2026/27 | CO₂ g/km | 2026/27 |
|---|---|---|---|
| 55–59 | 18% | 105–109 | 27% |
| 60–64 | 19% | 110–114 | 28% |
| 65–69 | 20% | 115–119 | 29% |
| 70–74 | 21% | 120–124 | 30% |
| 75–79 | 21% | 125–129 | 31% |
| 80–84 | 22% | 130–134 | 32% |
| 85–89 | 23% | 135–139 | 33% |
| 90–94 | 24% | 140–144 | 34% |
| 95–99 | 25% | 145–149 | 35% |
| 100–104 | 26% | 150–154 | 36% |
Original illustrative image; not a specific vehicle model.Often, yes. The 2026/27 electric car BIK rate is 4%, compared with up to 37% for higher-emission cars. But a low tax bill is only one part of the decision. Check the lease cost, insurance, charging access and how the car fits your week.
At the same £40,000 P11D value and 40% tax rate, an EV at 4% costs £53.33 a month in BIK tax. A petrol car emitting 130 g/km at 32% costs £426.67. These BIK calculator examples are illustrative full-year figures, without private fuel or contributions.
Try the electric BIK calculator →Your car benefit is not always the whole story. Keep these charges separate so you know who pays what.
For 2026/27, multiply £29,200 by the car’s BIK percentage to find the fuel benefit, then apply your Income Tax rate. This is a fixed statutory multiplier, not the amount spent at the pump.
At a 30% BIK rate and 40% Income Tax, private fuel adds £3,504 a year. If your own private fuel would cost less, “free fuel” may be poor value. Tick the fuel box in the BIK calculator to include it.
Reimbursing all private fuel within HMRC’s rules can remove the charge; partial repayment normally cannot. Electricity is not fuel for this charge.
Read HMRC’s fuel benefit rules ↗Your employer normally pays 15% of the taxable car and fuel benefits for 2026/27. The BIK calculator shows that cost separately. It is not an extra deduction from your payslip.
For a £1,600 car benefit with no taxable fuel, the employer’s Class 1A bill is £240. Your own Income Tax depends on your tax band.
Check employer rates on GOV.UK ↗A qualifying non-electric van with taxable private use has a £4,170 annual benefit, plus £798 for taxable private fuel. The van BIK calculator assumes full-year, sole use and no contributions or salary sacrifice.
Business journeys, ordinary commuting and insignificant other private use can qualify for exemption if the restricted-use conditions are met. Electric vans have a nil benefit under normal rules. Shared use, pickups, salary sacrifice and part-year cases need separate checks.
Check van exemptions ↗A BIK car tax calculator does not show your full salary sacrifice saving. You also need the gross salary given up, Income Tax and NI savings, and any impact on pension or other benefits.
For cars emitting no more than 75 g/km, normal car benefit rules apply. Above 75 g/km, optional remuneration rules can tax a higher amount based on salary or cash allowance given up. The BIK calculator does not model those arrangements.
Vehicle Excise Duty (road tax), VAT and business corporation tax relief are separate from employee BIK. They are not included in the monthly result.
Understand salary sacrifice rules ↗One BIK calculator can serve different brands because the underlying tax formula is the same. You do need the right vehicle details. Two versions of the same model can have different P11D values and emissions.
Have your Toyota quote to hand before using the BIK calculator. Enter the P11D value and certified CO₂ for the exact trim, then select its power type. For a plug-in hybrid emitting 1–50 g/km, add the certified electric range in miles.
Do not use an advertised “from” price as the P11D value. Optional equipment can change the taxable price, and the registration documentation should match the car you are actually ordering.
Open the Toyota BIK calculator →Use your Lexus fleet quote or manufacturer specification to complete the BIK calculator. A self-charging hybrid, plug-in hybrid and pure electric vehicle can sit in very different BIK bands.
For a pure electric Lexus, select electric and enter its P11D value. For a hybrid, use its certified emissions and, where relevant, electric range. Confirm whether the quote includes your chosen options.
Open the Lexus BIK calculator →Independent BIK calculator. Not affiliated with Toyota, Lexus or HMRC. No manufacturer price database or registration lookup is implied.
For a standard full-year company car, multiply its P11D value by its BIK percentage and your Income Tax rate, then divide by 12. Add taxable private fuel separately. Contributions, part-year availability and tax-band changes can affect the result.
The pure electric company car BIK rate is 4% for 6 April 2026 to 5 April 2027. A £40,000 car therefore creates a £1,600 taxable benefit before adjustments.
The company car benefit rules apply across the UK. Your Income Tax rate can differ: Scotland has starter, basic, intermediate, higher, advanced and top rates. Choose your region and applicable rate in the BIK calculator.
Yes. It works from the P11D value, power type, emissions and electric range you enter. Use the exact Toyota or Lexus specification rather than a generic model price. The tool does not fetch manufacturer data.
Usually, yes, if it is available for private use. The normal calculation uses the original list price rather than its current second-hand value. Special rules can apply to classic cars, which this BIK calculator does not calculate.
A qualifying capital contribution can reduce the price used by up to £5,000. Required private-use payments that you actually make can reduce the car benefit. Enter these separately in the advanced options; salary sacrificed is not the same as a private-use payment.
Normally, travel between home and a permanent workplace counts as private use for company cars. Vans have separate restricted-private-use rules, so a van used for commuting may qualify for exemption when the conditions are met.
Not necessarily. The monthly figure is the estimated annual tax divided by 12. PAYE coding, payrolling, tax-band changes, Personal Allowance tapering and other income can affect actual deductions. The BIK calculator assumes the whole benefit is taxed at your selected rate.
The benefit may be taxed through payroll or reflected in your PAYE tax code. Your employer is responsible for the relevant reporting. Check the benefit value and tax year with payroll if your payslip differs from the estimate.
The car tool covers standard cars with a certified CO₂ figure, car fuel benefit and employer Class 1A NI. It does not calculate classic cars, cars without an emissions figure, shared cars, specialist exemptions, optional remuneration comparisons or your complete Income Tax liability. Use HMRC guidance for these cases.
Rates and guidance checked on 15 October 2026. We link to the rules behind the figures so you can check the assumptions yourself. This is an independent planning tool, not HMRC or personalised tax advice.
The car calculation deducts a capped capital contribution from P11D value, applies the appropriate percentage, adjusts by chargeable days ÷ 365, then deducts qualifying private-use payments, with a minimum car benefit of zero. Fuel benefit uses its statutory multiplier and the same availability factor. Income Tax is estimated at your selected rate; employer NI uses 15%. Calculations retain precision until display. Both supported tax years contain 365 days.
Privacy: BIK calculator inputs and comparison entries stay in memory in your browser and clear on refresh. No advertising, analytics or calculator tracking scripts are included. The hosting provider may process technical access logs and authentication information. Read the full privacy policy.
Found a discrepancy? Compare the tax year, emissions, range and P11D value with the linked HMRC tables. For an individual tax-code or payroll correction, contact your employer or HMRC. See website correction guidance and our calculator disclaimer.
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