Home > > 2010/11 rates and allowances > Vehicle benefits

Vehicle benefits

Chargeable on employees earning £8,500 or over (including benefits), and directors.

The fuel benefit charge multiplier (FBC) for 2010/11 is £18,000 (2009/10 - £16,900).

Car benefit

The tax you pay on your company car is governed by five factors:

  • The list price of the car, on the day before it was first registered, plus certain accessories,
  • The rate at which the car emits carbon dioxide (CO2),
  • The fuel type (for most types of car, this is all the information you need to work out the taxable benefit)
  • Your highest rate of income tax
  • Any capital contribution to the cost of the car up to a maximum of £5,000

You can find your taxable percentage for 2010/11 using the following table:

2010/11 taxable benefits table

CO2 in g/km* Taxable % CO2 in g/km* Taxable %
Petrol Diesel Petrol Diesel
1 to 75 5% 8% 180 to 184 25% 28%
76 to 120 10% 13% 185 to 189 26% 29%
121 to 134 15% 18% 190 to 194 27% 30%
135 to 139 16% 19% 195 to 199 28% 31%
140 to 144 17% 20% 200 to 204 29% 32%
145 to 149 18% 21% 205 to 209 30% 33%
150 to 154 19% 22% 210 to 214 31% 34%
155 to 159 20% 23% 215 to 219 32% 35%
160 to 164 21% 24% 220 to 224 33% 35%
165 to 169 22% 25% 225 to 229 34% 35%
170 to 174 23% 26% 230 and over 35% 35%
175 to 179 24% 27%    

* The exact CO2 figure is rounded down to the nearest 5g/km

How to find out how much CO2 your company car emits – see:

  • The car’s V5 registration document
  • Your dealer
  • The data pages of car magazines (current models)
  • The Vehicle Certification Agency – www.vca.gov.uk
  • The website of the Society of Motor Manufacturers and Traders - www.smmt.co.uk/co2/co2search.cfm

Reliable emissions data is not widely available for cars registered before 1 January 1998. For them, the following taxable percentages apply, regardless of fuel type:

Engine capacity Taxable %
Up to 1400cc 15%
1401 - 2000cc 22%
Over 2000cc 32%

Car fuel benefits

If the employee pays for the full cost of all fuel for private journeys (usually including home to work) there will be no car fuel benefit. In all other cases the full tax charge will be due.

The taxable car fuel benefit, for 2010/11, is calculated by multiplying £18,000 by the same percentage as applies (or would apply) for the car benefit.

Example: A company car driver has a car which, on the day before it was first registered, had a list price of £18,000. It runs on petrol, and emits 172 g/km of CO2.

If we assume the driver pays tax at 40%, the annual tax bill on the car is: £18,000 x 23% x 40% = £1,656

If the employer provides any fuel used for private journeys and is not re-imbursed for the cost, the 2010/11 tax bill for the fuel is: £18,000 x 23% x 40% = £1,656.

Company vans

The taxable benefit for the unrestricted use of company vans is £3,000 (with no reduction for older vans) plus a further £550 (2009/10 - £500) of taxable benefit if fuel is provided by the employer for private travel.

The maximum tax payable on the use of a company van is £1,400 p.a., and the employer's Class1A NIC payable is £448 p.a.

The tax payable for a basic rate (20%) payer is £710, a 40% payer is £1,420 and someone paying 50% tax and using a company van would be £1,775!

The company's Class 1A NIC payable is £454.40.