BIK rates and company car tax

company car BIK rates 2021

Introduction to BIK rates

In April 2020, the UK Government switched the CO2 figures used to calculate tax rates from the old NEDC data to the current WLTP figures. As such, there was a change-over period where two different sets of BIK rates were used - one for vehicles registered before 6th April 2020, and one for those registered after that date. Please note that a vehicle's BIK rate will therefore depend on its registration date.

This change occurred at the same time as a new set of BIK rates, which were introduced to incentivise pure-electric cars. Pure-EVs are now rated at 1% for FY 2021/22. PHEVs recieve extremely low rates as before, but these are now graded based on the pure-electric range available. Those capable of travelling further on electric power receive lower BIK rates.

Company car tax rates are designed to encourage company car drivers to choose cars with lower levels of CO2 and NOx emissions; incentives are offered both to the company and to the recipient of the vehicle to select low emission vehicles.

Under the current system, company and employee company car tax are both based on a percentage of the official value of the car (called the 'P11D'), the percentage being primarily determined by the car's CO2 emissions. For the employee, the Benefit-in-Kind (BIK) is then taxed at the appropriate personal tax rate - usually collected through PAYE.

Company car tax payable by an employee is based on the vehicle's P11D value multiplied by the appropriate BIK rate (determined by the car's CO2 and fuel type) and the employee's income tax rate (basic rate of 20%, higher rate of 40%, or additional rate of 45%).

WLTP Company car BIK rates 2021 - 2024

Current company car BIK rates start at 1% for electric cars, 22% for the greenest hybrids, and 24% for any car with 100 g/km CO2. From 13%, bands rise in 1% increments to a maximum of 37%, with diesel models subject to a 4% supplement should they not meet RDE2 tests.

The table below shows how the percentage BIK rates vary with vehicle CO2 and electric-only range. It represents petrol-, diesel-, hybrid-, and electric-related BIK rates for 2021-2024. Note that the below table makes use of current WLTP-derived CO2 data, and for cars registered from April 2020. See seperate table for NEDC-derived CO2 BIK rates, for models registered before April 2020.

WLTP BIK Rates April 2021 to March 2024
Table shows BIK rates for models registered from 6th April 2020, based on official WLTP CO2 figures.
Vehicle
CO2
(g/km)
Electric
range
(miles)
FY 2021-22
%BIK Rate
FY 2022-23
%BIK Rate
FY 2023-24
%BIK Rate
Petrol,
Electric,
RDE2
Diesel**
Non-
RDE2
Diesel**
Petrol,
Electric,
RDE2
Diesel**
Non-
RDE2
Diesel**
Petrol,
Electric,
RDE2
Diesel**
Non-
RDE2
Diesel**
0 1 2 2
1-50 130+ 1 2 2
1-50 70-129 4 5 5
1-50 40-69 7 8 8
1-50 30-39 11 12 12
1-50 <30 13 14 14
51-54 14 15 15
55-59 15 16 16
60-64 16 17 17
65-69 17 18 18
70-74 18 19 19
75-79 19 23 20 24 20 24
80-84 20 24 21 25 21 25
85-89 21 25 22 26 22 26
90-94 22 26 23 27 23 27
95-99 23 27 24 28 24 28
100-104 24 28 25 29 25 29
105-109 25 29 26 30 26 30
110-114 26 30 27 31 27 31
115-119 27 31 28 32 28 32
120-124 28 32 29 33 29 33
125-129 29 33 30 34 30 34
130-134 30 34 31 35 31 35
135-139 31 35 32 36 32 36
140-144 32 36 33 37 33 37
145-149 33 37 34 37 34 37
150-154 34 37 35 37 35 37
155-159 35 37 36 37 36 37
160-164 36 37 37 37 37 37
165-169 37 37 37 37 37 37
170+ 37 37 37 37 37 37

** Rate applies to diesel vehicles not meeting the RDE2 standard. For diesel-hybrids, the Non-RDE2 4% diesel surcharge does not apply. All BIK rates will apply to cars registered from April 2020. Source: HMRC 2021.

4% supplement for non-RDE2 compliant diesels

HM Treasury levies a 4% diesel supplement over petrol models to account for greater levels of NOx emissions for the most current diesel cars. The supplement applies to diesel cars not compliant with the Real Driving Emissions Step 2 (RDE2) test, which confirms that real-world emissions are close to, or better than, the Euro 6 emissions standards for NOx.

NEDC Company car BIK rates 2021 - 2024

NEDC BIK Rates April 2021 to March 2024
Table shows BIK rates for models registered before 6th April 2020, based on official NEDC CO2 figures.
Vehicle
CO2
(g/km)
Electric
range
(miles)
FY 2021-22
%BIK Rate
FY 2022-23
%BIK Rate
FY 2023-24
%BIK Rate
Petrol,
Electric,
RDE2
Diesel**
Non-
RDE2
Diesel**
Petrol,
Electric,
RDE2
Diesel**
Non-
RDE2
Diesel**
Petrol,
Electric,
RDE2
Diesel**
Non-
RDE2
Diesel**
0 1 2 2
1-50 130+ 2 2 2
1-50 70-129 5 5 5
1-50 40-69 8 8 8
1-50 30-39 12 12 12
1-50 <30 14 14 14
51-54 15 15 15
55-59 16 16 16
60-64 17 17 17
65-69 18 18 18
70-74 19 19 19
75-79 20 24 20 24 20 24
80-84 21 25 21 25 21 25
85-89 22 26 22 26 22 26
90-94 23 27 23 27 23 27
95-99 24 28 24 28 24 28
100-104 25 29 25 29 25 29
105-109 26 30 26 30 26 30
110-114 27 31 27 31 27 31
115-119 28 32 28 32 28 32
120-124 29 33 29 33 29 33
125-129 30 34 30 34 30 34
130-134 31 35 31 35 31 35
135-139 32 36 32 36 32 36
140-144 33 37 33 37 33 37
145-149 34 37 34 37 34 37
150-154 35 37 35 37 35 37
155-159 36 37 36 37 36 37
160+ 37 37 37 37 37 37

** Rate applies to diesel vehicles not meeting the RDE2 standard. For diesel-hybrids, the Non-RDE2 4% diesel surcharge does not apply. All BIK rates apply to cars registered since 1998. Source: HMRC 2021.

Search for models by BIK rate here

Olly Goodall

Author:Olly Goodall
Date Updated:23rd Mar 2021

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