Calculate tax on employees' company cars

As an employer, if you provide company cars or fuel for your employees鈥� private use, you鈥檒l need to work out the taxable value so you can report this to HM Revenue and Customs (HMRC).

鈥楶rivate use鈥� includes employees鈥� journeys between home and work, unless they鈥檙e travelling to a temporary place of work.

Find out about tax on company cars if you鈥檙e an employee.

This guide is also available聽in Welsh (Cymraeg).

Work out taxable value

You can calculate taxable value using commercial payroll software.

Or you can use HMRC鈥檚 .

Using the HMRC calculator

Choose fuel type 鈥楩鈥� for diesel cars that meet the Euro 6d standard (also known as Real Driving Emissions 2). Choose type 鈥楧鈥� for other diesel cars.

Choose type 鈥楢鈥� for all other cars.

You can check a car鈥檚 CO2 emissions.

For electric cars and other cars with an approved CO2 emissions figure of 75g/km or less, answer 鈥榥o鈥� to the question 鈥榠s the car provided via an optional remuneration arrangement?鈥�.

If your car has an approved CO2 emissions figure of 1 to 50g/km, you鈥檒l also need to fill in the box for 鈥榸ero emission mileage鈥� (also known as electric range). This is the distance the car can go on electric power before its batteries need recharging.

You can get your zero emission mileage figure from:

  • your vehicle鈥檚 certificate of conformity, if you own the car
  • the leasing company or fleet provider, if you lease the car

Work out the value manually

You can also work out the value manually on P11D working sheet 2.

Taxable value of cars

The taxable value of a car is not the same as its cost. The taxable value also depends on:

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