COMPANY CAR RUNNING COSTS
If you’re looking for the most cost-effective company car, don’t forget the role that fuel economy should play in your decision.
A company car driver may choose a car based solely on the cost of benefit-in-kind taxation. However, this might lead to a higher overall cost when private fuel costs are taken into account.
The below example compares a petrol and a diesel fleet car with the same P11D value.
Although the petrol car offers lower benefit-in-kind taxation, when we consider the cost of private mileage, diesel is the lower cost option.
| Petrol | Diesel | ||||||||||
| P11D | £25,000 | £25,000 | |||||||||
| CO2 (g/km) | 138 | 123 | |||||||||
| BiK 2020/21 tax year | 30% | 31% | |||||||||
| BiK 2021/22 tax year | 31% | 32% | |||||||||
| BiK 2022/23 tax year | 32% | 33% | |||||||||
| Total BiK tax (20% taxpayer) | £4,650 | £4,800 | |||||||||
| MPG (Combined) | 44.5 | 53.3 | |||||||||
| Annual private mileage | 7,500 | 7,500 | |||||||||
| Fuel price / litre (p) | 114.2 | 118.0 | |||||||||
| Total fuel cost | £2,625 | £2,265 | |||||||||
| Total cost | £7,275 | £7,065 |
Calculate BIK and the amount of tax payable on SEAT business vehicles.
