Company Car Benefit Rules

   Car Benefit

Company Car CO2 Output

Once the taxable 'List Price' of a company car has been determined the next stage of calculating the company car benefit uses the engine's CO2 output.

By using CO2 output as a factor in calcuating company car benefit a degree of adjustment for the effect of internal combustion engine pollution and (in particular) global warming caused by company cars is introduced into the benefit.

The aim is to encourage company car drivers to choose cars with lower levels of CO2 output, though other pollutants produced by cars such as oxides of nitrogen and hydrocarbons are not currently included in the calculation.

What is the CO2 output of a company car?

CO2 output of a company car is determined by the amount of CO2 that a car emits from its exhaust, measured in Grammes Per Kilometre travelled (GPK/m).

The official CO2 output for a company car is published by the Vehicle Certification Agency (“VCA”), an agency of the Department of Transport.

Published CO2 ratings are generally only available for cars that have been sold since 1 January 1998.

Effect of CO2 output on company car benefit

A company car's annual taxable benefit is determined by multiplying the car's 'List Price' by a percentage determined according to its CO2 output.

The percentage is taken from a table which varies between tax years and whether or not the car was first registered before 6 April 2020.

To calculate the annual taxable benefit of a company car:

  1. Go to the table for the date of first registration of the vehicle.
  2. Look up the CO2 output of the car in the 1st column of the table (e.g. for 63GP/Km look at the row 60-64).
  3. Read across the table to find the taxable percentage of List Price of the car according to the CO2 output.
  4. If your car has a diesel engine, add a 4% surcharge to the table figure (up to a maximum of 37% including the surcharge) unless the car's engine meets the RDE2 standard for emissions.
  5. Multiply your car’s List Price by the percentage found.

For example, in the 2019/20 tax year;
  • your petrol fuelled car's list price is £20,000;
  • its CO2 output is 100GP/Km;

look down the 1st column of the 1st table to find 100-104, then across to the 2nd column (2019-20) to find the percentage (24%), then multiply £20,000 by 24% = £4,800 annual company car taxable benefit.

If your car’s CO2 output exceeds the maximum figure in the 1st column, use the maximum.



CARS REGISTERED
BEFORE 6 APRIL 2020

CO2
OUTPUT
(G/PKm)

ELECTRIC
ONLY
RANGE

PERCENTAGE OF LIST PRICE

2019-20 2020-21 2021-22 2022-23
0 N/A 16 0 1 2
1-50 >=130 16 2 2 2
1-50 70-129 16 5 5 5
1-50 40-69 16 8 8 8
1-50 30-39 16 12 12 12
1-50 <30 16 14 14 14
51-54 N/A 19 15 15 15
55-59 N/A 19 16 16 16
60-64 N/A 19 17 17 17
65-69 N/A 19 18 18 18
70-74 N/A 19 19 19 19
75 N/A 19 20 20 20
76-79 N/A 22 20 20 20
80-84 N/A 22 21 21 21
85-89 N/A 22 22 22 22
90-94 N/A 22 23 23 23
95-99 N/A 23 24 24 24
100-104 N/A 24 25 25 25
105-109 N/A 25 26 26 26
110-114 N/A 26 27 27 27
115-119 N/A 27 28 28 28
120-124 N/A 28 29 29 29
125-129 N/A 29 30 30 30
130-134 N/A 30 31 31 31
135-139 N/A 31 32 32 32
140-144 N/A 32 33 33 33
145-149 N/A 33 34 34 34
150-154 N/A 34 35 35 35
155-159 N/A 35 36 36 36
160-164 N/A 36 37 37 37
165+ N/A 37 37 37 37


CARS REGISTERED
FROM 6 APRIL 2020

CO2
OUTPUT
(G/PKm)

ELECTRIC
ONLY
RANGE

PERCENTAGE OF LIST PRICE

2020-21 2021-22 2022-23
0 N/A 0 1 2
1-50 >=130 0 1 2
1-50 70-129 3 4 5
1-50 40-69 6 7 8
1-50 30-39 10 11 12
1-50 <30 12 13 14
51-54 N/A 13 14 15
55-59 N/A 14 15 16
60-64 N/A 15 16 17
65-69 N/A 16 17 18
70-74 N/A 17 18 19
75-79 N/A 18 19 20
80-84 N/A 19 20 21
85-89 N/A 20 21 22
90-94 N/A 21 22 23
95-99 N/A 22 23 24
100-104 N/A 23 24 25
105-109 N/A 24 25 26
110-114 N/A 25 26 27
115-119 N/A 26 27 28
120-124 N/A 27 28 29
125-129 N/A 28 29 30
130-134 N/A 29 30 31
135-139 N/A 30 31 32
140-144 N/A 31 32 33
145-149 N/A 32 33 34
150-154 N/A 33 34 35
155-159 N/A 34 35 36
160-164 N/A 35 36 37
165-169 N/A 36 37 37
170+ N/A 37 37 37


To learn more about the new rules for electric and hybrid company cars from April 2020 click here.



Company Car Benefit Special Rules

Click the 'Next' button to learn more about the special rules that can affect company car benefit.


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(+44 1792 224319 outside UK)

info@drivesmart.co.uk