UK Company Car Tax Calculator
Calculate the taxable car and private-fuel benefits from the actual P11D facts, see the extra Income Tax beside your salary, and compare the result with the after-tax value of an optional cash allowance.
Published by GrowThenDraw Editorial Team · Editorial policy · Methodology & sources
| Item | Before car | With car and fuel | Difference |
|---|---|---|---|
| Taxable income | £60,000 | £61,800 | £1,800 |
| Personal Allowance | £12,570 | £12,570 | £0 |
| Income Tax | £11,432 | £12,152 | £720 |
| Employee NI on benefit | £0 | £0 | £0 |
| Step | Amount / rate |
|---|---|
| List price plus taxable accessories | £45,000 |
| Capital contribution used | −£0 |
| Adjusted price | £45,000 |
| Appropriate percentage | 4% |
| Car benefit before availability | £1,800.00 |
| Availability fraction | 365 / 365 |
| Required private-use payments | −£0 |
| Taxable car benefit | £1,800.00 |
| Taxable private-fuel benefit | £0.00 |
EV BIK sensitivity
| Tax year | EV BIK | Car benefit | Employee tax / month |
|---|---|---|---|
| 2026/27 | 4% | £1,800 | £60 |
| 2027/28 | 5% | £2,250 | £75 |
| 2028/29 | 7% | £3,150 | £105 |
| 2029/30 | 9% | £4,050 | £135 |
Full-year sensitivity only. It changes the legislated EV BIK percentage and freezes the entered salary, car price, private-use payment and 2026/27 Income Tax thresholds.
Salary-sacrifice EV quote
Start from the gross payroll deduction, audit the provider's net figure and compare the same EV with a private lease.
HMRC company-car calculator
Use the official service for a filing or employer cross-check, especially where the facts fall outside this page's scope.
All UK calculators
Connect workplace benefits with dividend tax, pensions, Child Benefit, mortgages, investing and retirement.
BIK percentage is only the first step
A company car's appropriate percentage depends on its 2026/27 CO2 band. A zero-emission car uses 4%. A plug-in hybrid at 1–50g/km also needs its certified electric-only range, while a diesel that does not meet the qualifying RDE2 standard normally receives a four-point supplement, capped at 37%.
The percentage is applied to the manufacturer list or P11D price plus taxable accessories, not a discounted purchase or lease price. An employee capital contribution can reduce that price, but no more than £5,000 is used in this calculation.
This calculator works out your actual incremental tax
Multiplying a taxable benefit by a guessed marginal rate can fail when the benefit crosses an Income Tax band or reduces the Personal Allowance above £100,000. GrowThenDraw calculates Income Tax before and after the car and fuel benefits using the entered salary, other non-savings income and the correct Scotland or rest-of-UK schedule.
Employee National Insurance is not charged on the company-car benefit. Employer Class 1A National Insurance is shown separately at 15%; it is an employer cost, not a deduction from the employee's pay.
Private fuel can create a large separate benefit
For 2026/27 the car-fuel benefit uses a fixed £29,200 multiplier and the same appropriate percentage as the car. Paying back only part of the private fuel does not proportionately reduce the charge: the input should say fully repaid only when all private fuel is made good under HMRC's rules by the deadline.
Electricity is not fuel for the company-car fuel-benefit charge. Workplace charging and other electric-car arrangements have their own conditions, so the calculator does not turn charging costs into a fuel benefit.
Company car versus cash allowance is a tax-only comparison here
The cash allowance is treated as extra employment income and the calculator recomputes both Income Tax and employee National Insurance. The comparison shows how much more cash the allowance route leaves before buying, leasing, insuring, maintaining, fuelling or charging a private car.
That is deliberately not a recommendation. Vehicle price, depreciation, insurance, maintenance, mileage reimbursement, contract limits and how long you keep the car can outweigh the tax difference.
Frequently asked questions
How much tax will I pay on a company car in 2026/27?
The taxable benefit is broadly the adjusted P11D price multiplied by the 2026/27 appropriate percentage and availability fraction, less qualifying private-use payments. Your extra Income Tax is then the difference between the full annual tax calculation with and without that benefit; it is not always the benefit times one marginal rate.
What price should I enter for the company car?
Use the manufacturer list or P11D price including VAT, delivery and relevant options. Add only taxable accessories not already included. Do not enter a discounted cash price, employer lease cost or monthly payment.
How does electric range affect plug-in-hybrid BIK?
For a 2026/27 car with 1–50g/km CO2, HMRC uses certified electric-only range bands: at least 130 miles, 70–129, 40–69, 30–39 or below 30. Use the figure on the official vehicle or employer documentation, not a real-world range estimate.
Does a capital contribution always reduce company-car tax?
A qualifying employee capital contribution toward the car or accessories can reduce the price used for the benefit, but this calculator applies HMRC's £5,000 cap. Regular payments specifically required for private use are entered separately after the availability calculation.
When can company-car unavailability reduce the benefit?
Dates before the car is first available and after it stops being available are counted automatically. An interruption while you still have the car normally counts only when it lasts at least 30 consecutive days and the car is actually unavailable, not merely unused.
Is a company car better than a cash allowance?
Tax alone cannot answer that. This page shows the company-car Income Tax cost and the allowance left after Income Tax and employee NI, but the cash route still has to fund a private vehicle and its running costs. Compare the same car, mileage, insurance, maintenance and contract period before deciding.
Can I use this for a salary-sacrifice car?
Use the separate UK salary-sacrifice car calculator for a low-emission employer quote. Optional-remuneration rules can require a comparison with salary foregone for higher-emission cars, which this ordinary company-car calculator deliberately does not guess.
UK company-car, fuel-benefit and tax rules verified 2026-09-23:
- HMRC Appendix 2: 2026/27 appropriate percentages
- HMRC Chapter 12: company-car benefit calculation
- HMRC EIM25105: 30-day unavailability rule
- HMRC Chapter 13: private-fuel benefit and making good
- HMRC rates: £29,200 car-fuel multiplier
- HMRC: 2026/27 Income Tax, NI and 15% Class 1A rate
- HMRC Appendix 12: optional-remuneration arrangements
- GOV.UK: special CO2 treatment for certain PHEV registrations
Scope: one ordinary non-classic company car available for private use; 2026/27 WLTP appropriate percentages; supplied list/P11D data; one availability period plus one total of qualifying 30-day interruptions; full-year non-savings Income Tax for England, Wales and Northern Ireland or Scotland; normal private-fuel benefit; category-A employee NI on an optional cash allowance; and employer Class 1A at 15%.
Excludes tax codes and payroll timing; savings and dividends; student loans and benefits; optional-remuneration calculations; classic, shared, pool, adapted and employee-owned cars; multiple or replacement cars; special PHEV certificate substitution; partial-year fuel withdrawal; fuel under optional remuneration; exact P11D filing; private-car costs; mileage reimbursements; contract suitability; and personalised tax, employment or financial advice.