Company Car Tax Calculator

Company car tax is income tax on the car's taxable benefit: its list price multiplied by a percentage set by its CO₂ emissions. Enter your salary, where you pay tax and the car's details to see the extra tax for 2026/27.

Uses 2026/27 tax rates (6 April 2026 to 5 April 2027). Results are estimates; your payslip may differ. See what is included

Your Details

You

£

Your gross pay for the tax year, before tax.

Where do you pay income tax?

Scotland has its own income tax bands. Wales and Northern Ireland use the same rates as England in 2026/27.

The car

£

The list price including VAT, delivery and options, before any discount.

Type of car
£
£/yr

Your company car tax

Income tax on the car benefit for 2026/27 (6 April 2026 to 5 April 2027). Fuel benefit and your employer's costs are not included.

Enter your details and press Calculate.

How this is calculated

The calculator works out your income tax for 2026/27 twice, with and without the car benefit, so it allows for the bands you fall into and for the Personal Allowance being withdrawn above £100,000.

  1. Appropriate percentage
    From HMRC's 2026/27 table: 4% for a fully electric car; 4% to 16% for 1 to 50 g/km depending on electric range; then 17% rising with CO₂ to a maximum of 37%. Diesels that do not meet RDE2 add 4%, within the maximum.

  2. Taxable car benefit
    (List price − your capital contribution, up to £5,000) × appropriate percentage − what you pay for private use.

  3. Income tax with and without the car
    Tax on your salary plus the benefit, minus tax on your salary alone, using the rest-of-UK or Scottish bands.

  4. Monthly figure
    The annual difference ÷ 12.

Worked example

A fully electric car with a £40,000 list price, for an employee in England earning £50,000. The 4% rate gives a £1,600 benefit, which takes taxable income into the higher-rate band.

Taxable car benefit
£1,600
Extra income tax a year
£586
A month
£48.83

£40,000 × 4% = £1,600. Tax on £50,000: (£50,000 − £12,570) × 20% = £7,486. Tax on £51,600: £37,700 × 20% + £1,330 × 40% = £8,072. Difference £586 a year, £48.83 a month.

Assumptions and limits

  • Tax year 2026/27 only. Wales and Northern Ireland use the same rates as England; Scotland uses its own bands.
  • Your salary is your only income and you have the standard Personal Allowance and tax code. Pension contributions, other income and reliefs are not included.
  • Fuel benefit (free private fuel), cars shared or unavailable for part of the year, vans and cars first registered before the current CO₂ rules are not handled.
  • The result is your personal income tax, not the cost to your employer (employer National Insurance on the benefit is not shown).

Key Takeaways

  • In 2026/27 a fully electric company car is taxed on 4% of its list price.
  • Plug-in hybrids of 1 to 50 g/km are taxed on 4% to 16% depending on electric range, so range matters as much as CO₂.
  • The tax depends on your total income: the same car can cost a higher-rate taxpayer about twice what it costs a basic-rate taxpayer.

Sources

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