BIK Rate Changes for April 2020

If you have access to a company car which you use for private use, you have to pay Benefit In Kind tax- this is calculated based on the cars retail price, its emissions and your tax bracket.

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In April 2020, the government are changing BIK tax for zero emission cars, the change is making zero emission cars have absolutely £0 in BIK tax.

Just for a quick comparison, if you took an brand new, average 2.0l diesel engine with an 130g/km emission this would put you in the 32% BIK bracket.

If the car costs around £30,500 you would then times this with the BIK percentage of 32%- which would be £9,760.

To then get the amount your company car will cost you in a tax year, you then multiply the BIK value by your tax income

Say your tax bracket is 20%, you would then times £9,760 with 20%= £1,952

This would work out to around £163 a month out of your monthly paycheck. If you had a zero emissions car you would pay absolutely nothing, therefore that's £163 a month you would be able to save!