Company Car Tax (BIK) Calculator 2026/27
Enter the car's P11D value, CO2 figure (and electric range for plug-in hybrids) plus your salary — see the benefit-in-kind percentage and your annual and monthly tax cost.
How it works
Company car tax works in three steps: the car's P11D value (list price incl. options and VAT, excl. first registration and road tax) is multiplied by the APPROPRIATE PERCENTAGE set by its CO2 emissions — 4% for fully electric cars up to 37% for high emitters in 2026/27 — giving the "cash equivalent", which is then taxed at your marginal income tax rate.
Plug-in hybrids (1-50 g/km) are banded by electric range: 130+ miles 4%, 70-129 miles 7%, 40-69 miles 10%, 30-39 miles 14%, under 30 miles 16%. Diesels not certified to RDE2/Euro 6d carry a 4% supplement (capped at 37%). The calculator uses the full official 2026/27 table from HMRC's 480 Appendix 2.
HONEST NOTE: BIK attracts income tax but NOT employee National Insurance — the calculator computes the exact extra tax by running the full 2026/27 computation on your salary with and without the benefit, so threshold effects (crossing into 40% or the £100k taper) are captured precisely rather than with a flat "×20%/×40%" shortcut.
FAQ
How much tax will I pay on my company car?
Multiply the P11D value by the CO2-based percentage, then by your marginal tax rate. Example: a £40,000 petrol car at 96 g/km sits in the 25% band → £10,000 cash equivalent → £2,000/year for a basic-rate taxpayer, £4,000 for higher-rate. A £40,000 electric car at 4% costs the same driver just £320/year — the tax gap between EV and petrol company cars remains enormous in 2026/27.
Why is my electric company car so cheap to tax?
Government policy deliberately keeps zero-emission BIK low to push fleets electric: 4% in 2026/27 (it was 2% until 2025 and is rising one point per year on the announced roadmap). On a £50,000 EV that is a £2,000 cash equivalent — £400/year tax at basic rate, versus £6,000+ for an equivalent petrol SUV. Salary-sacrifice EV schemes stack this low BIK with tax-free salary reduction, which is why they have become the standard way to fund an EV.
What counts as the P11D value, and does private fuel change the tax?
P11D value = manufacturer list price including VAT, delivery and factory options, EXCLUDING the first registration fee and first-year road tax — not what your employer actually paid, and discounts don't reduce it. If your employer also pays for private fuel, a separate fuel benefit charge applies (a fixed multiplier × the same percentage), which is poor value for most drivers doing normal private mileage — many are better off reimbursing private fuel instead.