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BiK Rates Company Car Tax

Company cars remain highest value Benefit in Kind whilst take-up remains stable

Provisional HMRC figures for 2013-14 shows that the number of drivers paying BiK on a company car was 940,000 – the same as for 2012-13 but a decline on the 950,000 in 2011-12 and down 18% on the 1.14m drivers for 2005-6.

Meanwhile 200,000 people paid Benefit in Kind on car fuel in 2013-14 according to the provisional data, down from 220,000 in 2012-13 and reduced by 47% from the 380,000 in 2005-6.

HMRC said the sharper reduction for car fuel benefit is likely to reflect rising fuel prices, causing employers and employees to look more carefully at whether the fuel benefit formula results in a tax charge commensurate with the true value of the benefit. 

The full HMRC data for 2012-13 shows that company cars remain the highest value Benefit in Kind, equating to a taxable value of £3.7bn or 50% of the taxable value of all Benefits in Kind.

Meanwhile 220,000 people paid Benefit in Kind on car fuel, with a taxable value of £770m or 10% of the total value.

Car benefit and car fuel benefit together represented 60% of the total taxable value of all benefits in kind, considerably higher than the proportion of recipients who received these benefits. This was due to the higher average tax liability for these benefits. 

The HMRC data also breaks down emissions for company car take-up and shows established strong trend in the reduction of the level of emissions. A total of 81% of drivers in 2012-13 opted for a diesel model, with 19% categorized as non-diesels.

A total of 91% of company cars in 2012-13 emitted less than 165g/km of CO2, an increase from 87% in 2011-12. This group contributes 79% of the tax and 82% of the NIC liability.

20,000 drivers (2%) were taxed on a car model with less than 95g/km CO2 emissions. The largest concentration of drivers (21%) was seen in the 115-124g/km emissions bracket. 10,000 drivers (1%) were taxed on a model with 225g/km or over.


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Natalie Middleton

Natalie has worked as a fleet journalist for 16 years, previously as assistant editor on the former Company Car magazine before joining Fleet World in 2006. Prior to this, she worked on a range of B2B titles, including Insurance Age and Insurance Day. As Business Editor, Natalie ensures the group websites and newsletters are updated with the latest news.