Taxation

Company Car Benefit-In-Kind Taxation

Benefit-in-kind (or BIK) is a tax on employees who receive benefits or perks on top of their salary. If you have a company car for private use, you will have to pay a BIK contribution.

To calculate the BIK tax, multiply the P11D value by the BIK percentage banding, then multiply that figure by your tax band – i.e. 20% or 40%.

Every car has a BIK percentage banding. This is based on CO2 emissions, and a P11D value, which is the list price, including extras and VAT, but without the first year registration fee and vehicle tax.

The table below shows BIK tax bands (also known as company car tax) based on CO2 emissions of your vehicle. BIK (company car tax) bands have currently been set until 2019/20.

% of P11D 2015/16 2016/17 2017/18 2018/19 2019/20
Price CO2 (g/km) CO2 (g/km) CO2 (g/km) CO2 (g/km) CO2 (g/km)
0 N/A N/A N/A N/A N/A
5 0-50 N/A N/A N/A N/A
7 N/A 0-50 N/A N/A N/A
9 51-75 N/A 0-50 N/A N/A
10 N/A N/A N/A N/A N/A
11 N/A 51-75 N/A N/A N/A
12 N/A N/A N/A N/A N/A
13 76-94 N/A 51-75 0-50 N/A
14 95-99 N/A N/A N/A N/A
15 100-104 76-94 N/A N/A N/A
16 105-109 95-99 N/A 51-75 0-50
17 110-114 100-104 76-94 N/A N/A
18 115-119 105-109 95-99 N/A N/A
19 120-124 110-114 100-104 76-94 51-75
20 125-129 115-119 105-109 95-99 N/A
21 130-134 120-124 110-114 100-104 N/A
22 135-139 125-129 115-119 105-109 76-94
23 140-144 130-134 120-124 110-114 95-99
24 145-149 135-139 125-129 115-119 100-104
25 150-154 140-144 130-134 120-124 105-109
26 155-159 145-149 135-139 125-129 110-114
27 160-164 150-154 140-144 130-134 115-119
28 165-169 155-159 145-149 135-139 120-124
29 170-174 160-164 150-154 140-144 125-129
30 175-179 165-169 155-159 145-149 130-134
31 180-184 170-174 160-164 150-154 135-139
32 185-189 175-179 165-169 155-159 140-144
33 190-194 180-184 170-174 160-164 145-149
34 195-199 185-189 175-179 165-169 150-154
35 200-204 190-194 180-184 170-174 155-159
36 205-209 195-199 185-189 175-179 160-164
37 210+ 200+ 190+ 180+ 165+
  • Add 3% for diesels up to a maximum of 37% in 2015/16
  • From 2016/17 onwards the diesel supplement was due to be scrapped – this will now be delayed until 2020/21.

The appropriate percentage of the list price subject to tax for the 0-50g/km will be 5% in 2015-16, and 7% in 2016-17. From April 2015, two new company car tax bands were introduced at 0-50g/km and 51-75g/km.

For Employers – The final word on BIK Taxation

For Employees – The final word on BIK Taxation

 

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