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COMPANY CAR?
LET’S TALK BENEFIT-IN-KIND TAX.
Offering great perks can be beneficial for business and employee alike.
But what are the tax implications? We’re here to help you understand the economics of providing a company car.
FIRST THINGS FIRST:
WHAT IS BENEFIT-IN-KIND TAX?
Benefit-in-Kind (BIK) Tax is all about fairness, really. If an employee receives a company benefit, it’s still a form of payment – and that means it’s subject to tax. Some perks are tax-free, like cycle-to-work schemes, but a company car. That comes with BIK Tax.
HOW DO YOU CALCULATE BIK TAX?
BIK tax is based on two main factors: the vehicle’s value and its CO₂ emissions.
Here’s the basic formula:
BIK value (i.e. the taxable income) = Vehicle’s cash value × BIK rate
(The BIK rate is determined by the vehicle's CO₂ emissions.)
The lower the emissions, the lower the BIK rate – resulting in a lower BIK tax.
ELECTRIC PERKS.
Coming in at 3% for 2025/26, the BIK rate for a BEV vehicle has making the switch to electric seem like a no-brainer.
Take the MINI Cooper Electric. Available from £ 26,905 and emitting 0g/km of CO2, the taxable value would be £ 26,905 x 3% = £807.15
So, depending on the employee’s tax bracket, that could look like –
807.15 x 20% = 161.43 per year / 13.45 per month
807.15 x 40% = 322.87 per year / 26.9 per month
807.15 x 45% = 363.22 per year / 30.29 per month
Benefits of MINI for Business.
Whether you’re looking for one or two company cars or an entire fleet, MINI for Business is a great choice. We offer an attractive range of cars with low emissions whilst driving that will help you deliver an appealing benefits packages to staff and boost that employee motivation and retention.
COMPARE BIK RATES ACROSS THE MINI RANGE.
No matter your business needs, there’s a MINI that can work for you. For our current BIK rates, we’ve put together a handy table.
BIK FOR OLDER MINI FLEETS.
If you manage or drive vehicles in a MINI fleet produced prior to 2023, you can check the BIK rate for our previous generation here.