How leasing works

What Is Benefit In Kind?

If your new vehicle is a company car that will be made available for private use, a "benefit in kind" value will be calculated on which you will pay tax.

How is it calculated?

The full price of the car including optional extras, manufacturers delivery and VAT, known as the P11D value is multiplied by the appropriate % based on the CO2 emissions of the car. Please see the table above for the appropriate %.

Cars

 
 

You will be charged tax on this amount at the highest rate at which you pay income tax.

Refer to this table to work out your Benefit in Kind.

Use this handy calculator to work out your Benefit in Kind.

Fuel Charge

The Government fuel scale charge for calculating the tax due on employer-provided 'free' fuel for private use in a company car rises to £24,100 from April 6th 2019.

If your employer provides fuel for your private use this is a benefit to you and you will incur a tax charge.

This is calculated by multiplying £24,100 (a set amount irrespective of car driven) by the same % derived from the CO2 of your car, see above or table below. For example, a petrol car with CO2 emissions of 99 g/km has a tax charge of 23%. The fuel scale charge is £24,100 x 23% = £5,543, equating to annual fuel tax liability of £1,108.60 for a 20% tax payer, or £2,217.20 for a 40% tax payer.

Vans

Since April 2018, the Van Benefit Charge (VBC) rate for drivers of company vans, including 'double-cab' pick-ups, who use their vehicles for private mileage is set at £3,350, or £3,983 if the employer also provides 'free' fuel.

This translates to annual tax payable on any company van used privately of £670 for a 20% tax payer, or £1,340 for a 40% tax payer. Where fuel is also provided for private use, the tax payable is £796.60 for a 20% tax payer, or £1,593.20 for a 40% tax payer. Employees using their vans to drive from home to customers, and who are not allowed other private use, do not pay BIK tax.

Advisory Fuel Rates from 1 September 2019

These rates apply from 1 September 2019. You can use the previous rates for up to one month from the date the new rates apply.

Engine size

Petrol - amount per mile

LPG - amount per mile

Engine size

Diesel -  Amount per mile

1400cc or less

12 pence

8 pence

1600cc or less

10 pence

1401cc to 2000cc

14 pence

10 pence

1601cc to 2000cc

11 pence

Over 2000cc

21 pence

14 pence

Over 2000cc

14 pence


Hybrid cars are treated as either petrol or diesel cars for this purpose.

Hybrid powered company car mileage rates

  • Drivers of petrol/electric hybrid company cars should use the petrol rates.
  • Drivers of diesel/electric hybrid cars should use the diesel rates.

These rates are only applicable to employees using a company car.

Advisory electricity company car mileage rate for fully electric cars is 4p.

  2019/20
CO2 emissions (g/km) Petrol & Hybrids % Diesel %
0 16% 20%
1 to 50 16% 20%
51 to 75 19% 23%
76 to 94 22% 26%
95 to 99 23% 27%
100 to 104 24% 28%
105 to 109 25% 29%
110 to 114 26% 30%
115 to 119 27% 31%
120 to 124 28% 32%
125 to 129 29% 33%
130 to 134 30% 34%
135 to 139 31% 35%
140 to 144 32% 36%
145 to 149 33% 37%
150 to 154 34% 37%
155 to 159 35% 37%
160 to 164 36% 37%
165 to 169 37% 37%
170 to 174 37% 37%
175 to 179 37% 37%
180 to 184 37% 37%
185 to 189 37% 37%
190 to 194 37% 37%
195 to 199 37% 37%
200 to 204 37% 37%
205 to 209 37% 37%
210 to 214 37% 37%
215 to 219 37% 37%
220 to 224 37% 37%
225 to 229 37% 37%
230 to - 37% 37%
  2020/21
CO2 emissions (g/km) Electric Miles Petrol & Hybrids % Diesel %
0   2% 6%
1 to 50 >130 2% 6%
1 to 50 70-129 5% 9%
1 to 50 40-69 8% 12%
1 to 50 30-39 12% 16%
1 to 50 <30 14% 18%
51 to 54   15% 19%
55 to 59   16% 20%
60 to 64   17% 21%
65 to 69   18% 22%
70 to 74   19% 23%
75 to 79   20% 24%
80 to 84   21% 25%
85 to 89   22% 26%
90 to 94   23% 27%
95 to 99   24% 28%
100 to 104   25% 29%
105 to 109   26% 30%
110 to 114   27% 31%
115 to 119   28% 32%
120 to 124   29% 33%
125 to 129   30% 34%
130 to 134   31% 35%
135 to 139   32% 36%
140 to 144   33% 37%
145 to 149   34% 37%
150 to 154   35% 37%
155 to 159   36% 37%
160 to 164   37% 37%
165 to 169   37% 37%
170 to 174   37% 37%
175 to 179   37% 37%
180 to 184   37% 37%
185 to 189   37% 37%
190+   37% 37%

Benefit in Kind Calculator

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