Rates & allowances
Vehicles — UK rates and thresholds
Benefit-in-kind percentages by CO₂ emissions and fuel-only mileage rates.
2026/27
Vehicles — Benefit in Kind 2026/27
- Pure electric (0 g/km)£4 %
- 1–50 g/km, 130+ mile electric range£4 %
- 1–50 g/km, 70–129 miles£7 %
- 1–50 g/km, 40–69 miles£10 %
- 1–50 g/km, 30–39 miles£14 %
- 1–50 g/km, < 30 miles£16 %
- Diesel supplement (non Euro 6d)£4 % added
- Maximum BIK %£37 155 g/km+
- Car fuel benefit multiplier£29,200
- Van benefit£4,170
- Van fuel benefit£798
Mileage Allowance Payments (MAPs)
- Cars/vans — first 10,000 miles£45 p per mile
- Cars/vans — over 10,000 miles£25 p per mile
- Motorcycles£24 p per mile
- Bicycles£20 p per mile
Vehicle tax rates and benefits
Vehicles carry several tax figures: HMRC approved mileage rates for using your own car for business, advisory fuel rates for company cars, and the CO₂-based percentages that set the benefit-in-kind on a company car. The tables above show the current rates.
The right choice — company car versus mileage, electric versus petrol — depends on your circumstances. We model the options so you pick the most tax-efficient one.
Company cars are taxed on emissions, not on cost
The benefit is a percentage of the list price, and the percentage is set by CO₂ emissions — which is why a fully electric car is taxed at a small fraction of the rate of a petrol equivalent, and why the same money spent on a different car can produce a very different tax bill for the employee and a different Class 1A charge for the employer.
Fuel provided for private use is a separate benefit, calculated on a fixed figure rather than on what the fuel actually cost. For low private mileage it is very often the worst-value benefit available: the tax can exceed the value of the fuel.
Mileage in your own car
Where an employee uses their own vehicle for business, an approved mileage rate can be paid free of tax up to a threshold of annual business miles, and at a lower rate above it. If the employer pays less than the approved rate, the employee can claim the difference as tax relief — a claim a great many people are entitled to and never make.
Frequently asked
What can I claim for business mileage?+
HMRC’s approved mileage allowance payments for using your own vehicle. We set up records so you claim the full, correct amount.
Are electric company cars worth it?+
Often yes — their very low benefit-in-kind percentage makes them highly tax-efficient. Use our company car calculator and ask us to model it.
Why is an electric company car so much cheaper?+
Because the benefit is a percentage of list price set by CO₂ emissions, and an electric car sits at a small fraction of the percentage applied to a petrol equivalent. The same purchase price can produce very different tax for the employee and different employer contributions.
Should I take free fuel for private use?+
Usually not. It is taxed on a fixed figure regardless of how much fuel you actually use, so unless private mileage is high the tax commonly exceeds the value of the fuel. Paying for your own private fuel is often cheaper.
Can I claim for using my own car?+
Yes. Approved mileage rates can be paid tax-free up to a threshold of annual business miles and at a lower rate beyond it. If your employer pays less than the approved rate, you can claim tax relief on the shortfall — a claim many people never make.
Rates in context
Knowing the rate is not the same as knowing the bill.
Thresholds interact — allowances taper, reliefs stack, and the order you take income in changes the total. We plan for that.
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