Company Car Tax Calculator 2026/27
Accurate HMRC Benefit in Kind (BIK) estimator for UK employees, directors and fleet managers. Updated for 2026 tax year, electric & hybrid rates.
Calculate your company car tax
Your 2026/27 Company Car Tax
How company car tax is calculated in the UK (2026/27 guide)
Your company car tax depends on three core elements: the car’s P11D value, its CO₂ emissions (or electric range for hybrids), and your personal income tax band. The HMRC applies a Benefit in Kind (BIK) percentage based on the vehicle’s environmental rating. From April 2026, electric cars retain the ultra-low 2% BIK rate, while petrol and diesel models face increased percentages. Use our company car tax calculator UK to get an instant estimate — accurate for 2026 tax year changes.
📋 Step-by-step: calculate your company car tax manually
- Find P11D value — list price including options, VAT, delivery (excl. first registration fee).
- Determine the appropriate BIK% based on fuel type, CO₂ emissions, and electric range (for hybrids).
- Multiply P11D × BIK% = taxable benefit value per year.
- Multiply benefit by your marginal income tax rate (20%/40%/45%) = actual tax owed annually.
📊 Company car BIK rates table (2026/27 tax year)
| Vehicle type / CO₂ (g/km) | Electric range (miles) | BIK % (2026/27) |
|---|---|---|
| Electric (0 g/km) | — | 2% |
| Plug-in hybrid (1–50 g/km) | 0–9 | 14% |
| Plug-in hybrid (1–50 g/km) | 10–29 | 11% |
| Plug-in hybrid (1–50 g/km) | 30–59 | 8% |
| Plug-in hybrid (1–50 g/km) | 60–99 | 5% |
| Plug-in hybrid (1–50 g/km) | 100+ | 2% |
| Petrol/Diesel (51–55 g/km) | — | 2% + supplement |
| Petrol/Diesel (56–60 g/km) | — | 3% + supplement |
| Petrol/Diesel (61–65 g/km) | — | 4% + supplement |
| Petrol/Diesel (91–95 g/km) | — | 10% + supplement |
| For CO₂ >55 g/km: add 1% per 5g up to max 37% | — | |
Diesel supplement (+4%) applies to non-RDE2 diesels, capped at 37%. Our calculator includes this option.
🧾 Real-world examples (2026 rates)
- Electric car: BMW i4, P11D £55,000, BIK 2% → benefit £1,100; higher rate taxpayer (40%) pays £440/year (£36.67/mo).
- Plug-in hybrid: VW Golf eHybrid, P11D £36,000, electric range 40 miles → BIK 8% → benefit £2,880; basic rate (20%) tax = £576/year.
- Petrol car: Ford Focus, CO₂ 118g/km, P11D £28,000, BIK% = 2 + floor((118-55)/5) = 14% → benefit £3,920; 40% taxpayer = £1,568/year.
💰 Salary sacrifice & company car tax interactions
If you obtain a car via salary sacrifice, the benefit in kind value is still calculated on the P11D and BIK% (not on the monthly sacrifice). However, your taxable income reduces, which may affect student loan repayments and pension contributions. Our company car tax salary calculator gives a clear picture of net cost, but always consult a tax adviser.
⚡ Electric & hybrid 2026 focus: what’s changed?
From April 2026, the government has frozen electric car BIK at 2% for the next two years, making EVs the most tax-efficient choice. For plug-in hybrids, the new 2026 bands reward vehicles that realistically run on electric power. If you’re a fleet manager or employee choosing a car, prioritise models with WLTP electric range above 100 miles to qualify for the 2% rate. Meanwhile, standard petrol/diesel cars see incremental BIK increases inline with inflation and CO₂ targets.
✔️ Choose fully electric (2% BIK) or high-range plug-in hybrids.
✔️ Avoid diesel models unless RDE2 compliant (avoid 4% supplement).
✔️ Opt for optional accessories that don’t increase P11D value (e.g., removable extras).
✔️ Consider making an employee capital contribution to reduce taxable P11D.
✔️ Review your marginal tax rate — salary sacrifice may shift tax band.
📌 Frequently asked questions: company car tax
Multiply car’s P11D value by the BIK percentage (based on CO₂/range) to get benefit value, then multiply by your income tax rate. Our calculator automates this with 2026/27 rates.
Electric cars (0g/km) attract 2% Benefit in Kind for 2026/27 — the lowest rate available.
This calculator focuses on car benefit (BIK). Fuel benefit for private fuel is separate; consult HMRC if fuel card is provided.
Plug-in hybrids with CO₂ ≤50g/km use electric range thresholds. Our hybrid selector gives the exact 2026/27 BIK% based on official range.
Yes, any employee payment toward the car (up to £5,000) reduces the P11D value, lowering taxable benefit.
HMRC collects it via your PAYE tax code, so your monthly net pay reduces automatically.
Important notice
TotalCalcHub provides the company car tax calculator for illustrative purposes only. While we follow HMRC BIK rates for 2026/27, individual circumstances (such as official CO₂ figures, optional modifications, or special vehicle categories) may alter final tax liability. Always verify with a qualified accountant or HMRC guidance. By using this tool, you agree to our Terms.