How do CO2 emissions affect the BIK rates?
One of the main factors that affects your BIK tax rates is the amount of CO2 the car emits per kilometre driven. The higher the emissions, the higher the Benefit-in-Kind (BiK) tax rate.
Current company car BIK rates start at 1% for electric cars, 22% for the greenest hybrids, and 24% for any vehicle with 100 g/km CO2.
The amount of company car or Benefit in Kind (BiK) tax you pay depends on these factors:
- The carbon dioxide (CO2) emissions per kilometre of your chosen vehicle
- The value of the vehicle when new, including any optional extras (known as the P11D value)
- Whether you have personal use of the vehicle and have made any individual contribution towards its cost.
- Your personal tax rate
What are the best electric and low emission cars?
When deciding on a company car, you want to find a vehicle lease hire that is suitable for your requirements. If appearances are key, exterior style will be high on your list. You may also need a car that is comfortable and spacious on long commutes. Whatever you choose, it is worth keeping in mind the amount of company car tax you will be likely to pay. As such, it may be best to look for a vehicle that offers low Benefit-in-Kind (BiK) rates.
With current rules and environmental limitations, current company car tax rates favour electric and low emission vehicles over traditional combustion engine cars. We have listed some examples of cars with low BiK rates, including a mix of electric vehicles and low emission hybrids.