Company Van Benefit In Kind Taxation
When employees receive a company van they will be taxed on the Benefit in Kind (BIK) if being used for personal use. The tax paid on the company van BIK is referred to as Company Car Tax (CCT).
This page provides an overview of the company van taxation system, including both the van-only and van & fuel benefits, as well as specific tax rules for pick-up trucks. The following tax calculations apply to the tax years 2024/25, 2025/26, and beyond, as per the latest guidelines from HMRC.
Company Van Taxation (Personal Use) 2025/2026 (As of 6th April 2025)
Taxable benefit of £4,020 in the tax year 2024/25
Fuel benefit of £769 in the tax year 2025/26
Calculation examples (for the year):
Van Only benefit = £4,020
20% taxpayer = £804
40% taxpayer = £1,608
Van & Fuel Benefit (£4,020 + £769) = £4,789
20% taxpayer = £958
40% taxpayer = £1,916
The government reduced the van benefit charge to Zero for vans that produce zero carbon emissions from 6th April 2021 (Finance Bill 2020)
These figures will rise by the CPI (Consumer Price Index) in 2026 (April)
Pick-Ups
A company pick-up benefit is now calculated by multiplying the pick-ups list price (including optional accessories) by the relevant percentage according to the carbon dioxide (CO2) emissions - if being used for person use.
If you drive a plug-in hybrid pick-up that emits less than 50g/km, the rate is based on the battery zero-emissions range. This is the distance (measured in miles) the car/van can go on electric power before its batteries need recharging.
The relevant percentage of list price for the tax years are as below.
|
CO2 (g/km) |
Electric range (miles) |
2024/25 (%) |
2025/26 (%) |
2026/27 (%) |
2027/28 (%) |
2028/29 (%) |
2029/30 (%) |
|
0 |
N/A |
2 |
3 |
4 |
5 |
7 |
9 |
|
1-50 |
>130 |
2 |
3 |
4 |
5 |
18 |
19 |
|
1-50 |
70-129 |
5 |
6 |
7 |
8 |
18 |
19 |
|
1-50 |
40-69 |
8 |
9 |
10 |
11 |
18 |
19 |
|
1-50 |
30-39 |
12 |
13 |
14 |
15 |
18 |
19 |
|
1-50 |
<30 |
14 |
15 |
16 |
17 |
18 |
19 |
|
51-54 |
|
15 |
16 |
17 |
18 |
19 |
20 |
|
55-59 |
|
16 |
17 |
18 |
19 |
20 |
21 |
|
60-64 |
|
17 |
18 |
19 |
20 |
21 |
22 |
|
65-69 |
|
18 |
19 |
20 |
21 |
22 |
23 |
|
70-74 |
|
19 |
20 |
21 |
21 |
22 |
23 |
|
75-79 |
|
20 |
21 |
21 |
21 |
22 |
23 |
|
80-84 |
|
21 |
22 |
22 |
22 |
23 |
24 |
|
85-89 |
|
22 |
23 |
23 |
23 |
24 |
25 |
|
90-94 |
|
23 |
24 |
24 |
24 |
25 |
26 |
|
95-99 |
|
24 |
25 |
25 |
25 |
26 |
27 |
|
100-104 |
|
25 |
26 |
26 |
26 |
27 |
28 |
|
105-109 |
|
26 |
27 |
27 |
27 |
28 |
29 |
|
110-114 |
|
27 |
28 |
28 |
28 |
29 |
30 |
|
115-119 |
|
28 |
29 |
29 |
29 |
30 |
31 |
|
120-124 |
|
29 |
30 |
30 |
30 |
31 |
32 |
|
125-129 |
|
30 |
31 |
31 |
31 |
32 |
33 |
|
130-134 |
|
31 |
32 |
32 |
32 |
33 |
34 |
|
135-139 |
|
32 |
33 |
33 |
33 |
34 |
35 |
|
140-144 |
|
33 |
34 |
34 |
34 |
35 |
36 |
|
145-149 |
|
34 |
35 |
35 |
35 |
36 |
37 |
|
150-154 |
|
35 |
36 |
36 |
36 |
37 |
38 |
|
155-159 |
|
36 |
37 |
37 |
37 |
38 |
39 |
|
160-164 |
|
37 |
37 |
37 |
37 |
38 |
39 |
|
165-169 |
|
37 |
37 |
37 |
37 |
38 |
39 |
|
170+ |
|
37 |
37 |
37 |
37 |
38 |
39 |
Employers National Insurance
The employer also has to pay National Insurance Contributions against this Benefit in Kind (BIK) – Employer’s (secondary) Class 1 contribution
The standard rate is 15%
Electric Vehicle Range Figures (Electric Mileage Range/Zero Emission Mileage/Zero Emission Range
Electric range is the number of miles which is the equivalent of the number of kilometres specified in an EC certificate of conformity, an EC type-approval certificate or a UK approval certificate on the basis of which a car is registered, as being the maximum distance for which the car can be driven in electric mode without recharging the battery.
Still Not Sure? Were here to help - just send us a message..
Yes, there has been a recent change meaning that double-cab pick-up trucks will now be treated as company cars for tax purposes, affecting the Benefit in Kind (BIK) tax paid by the driver from April 2025. Read More
Yes, the van benefit charge is subject to inflation and will rise by the Consumer Price Index (CPI) in April 2026.