BIK rates scrapped for EVs in 202021

The government aims to promote EV uptake with zero BIK rates

HM Treasury has announced Company Car Tax rates up until Financial Year 2022-23, and plans to use reduced rates for zero tailpipe-emission models to boost sales.

With new figures, the government aims "to accelerate the shift to zero emission cars, all zero emission models will pay no company car tax in 2020-21, 1% in 2021-22 before returning to the planned 2% rate in 2022-23".

All pure-electric models will pay zero BIK for FY 2020-21, 1% in 2021-22, and then 2% in 2022-23. From there, the ratings are divided between those models registered before 6th April 2020, and those registered afterwards.

Vehicle CO2 (g/km)	Electric range (miles)	FY 2020-21 %BIK Rate	FY 2021-22 %BIK Rate	FY 2022-23 %BIK Rate
Company Car Tax BIK Rates April 2020 to March 2023 Cars first registered from 6th April 2020
0		0	1	2
1-50	130+	0	1	2
1-50	70-129	3	4	5
1-50	40-69	6	7	8
1-50	30-39	10	11	12
1-50	<30	12	13	14
51-54		13	14	15
55-59		14	15	16
60-64		15	16	17
65-69		16	17	18
70-74		17	18	19
75-79		18	19	20
80-84		19	20	21
85-89		20	21	22
90-94		21	22	23
95-99		22	23	24
100-104		23	24	25
105-109		24	25	26
110-114		25	26	27
115-119		26	27	28
120-124		27	28	29
125-129		28	29	30
130-134		29	30	31
135-139		30	31	32
140-144		31	32	33
145-149		32	33	34
150-154		33	34	35
155-159		34	35	36
160-164		35	36	37
165-169		36	37	37
170+		37	37	37

Those models registered before that date will see BIK rates frozen for all financial years until 2022-23, while those registered from that date will effectively see BIK rates cut 2% for each band.

The reason behind this is that the figures will be based on WLTP data, which a government review has found varies greatly between precious NEDC figures depending on make and model.

Data showed CO2 values for cars tested under both protocols varying from 7% to 40%, though an average increase of 20%-25% was found. Cars with smaller engines tended to see above average increases in CO2 figures, and diesel cars were impacted upon slightly more than petrols.

Next Green Car will update its BIK rate rules for models as soon as possible, now that this fresh information has finally come through from the government.

Find out more about Company Car Tax