P11D value calculator
A company car's tax starts from its P11D value: list price plus options and delivery, minus any capital contribution. Build it here, then see the Benefit-in-Kind and the tax at your rate.
How the P11D value is built
Start with the list price the manufacturer published for the car when new, including VAT and delivery. This is the notional price, not the discounted deal your employer negotiated, which is why the P11D value often sits above the invoice. Add any factory-fitted options, from metallic paint to a bigger alloy set, because they raise the taxable price too.
Then take off a capital contribution if you paid one, up to a £5,000 limit. What remains is the P11D value. To turn it into a tax bill, multiply by the appropriate percentage for the car, which is driven by CO2 emissions and, for plug-in hybrids and electric cars, the electric-only range. That product is the Benefit-in-Kind, the yearly value of the benefit, and you pay income tax on it at your own rate.
Worked example
A car with a £34,000 list price, £1,500 of options and £800 delivery has a P11D value of £36,300. At a 25% percentage the taxable benefit is £9,075 a year. A higher-rate taxpayer pays 40% of that, which is £3,630 a year, or about £302.50 a month taken through the tax code. Drop the percentage to an electric car’s level and the benefit, and the tax, fall sharply.
Common questions
What is a P11D value?
The P11D value is the taxable price of a company car for benefit purposes. It is the manufacturer’s list price when new, including VAT and delivery, plus any factory-fitted options, minus any capital contribution you made. It is not what the employer paid after a discount, which is why it can look higher than the deal price.
How does the P11D value become a tax bill?
Multiply the P11D value by the appropriate percentage, which depends on the car’s CO2 emissions and, for plug-ins, its electric range. That gives the Benefit-in-Kind, the yearly taxable value of having the car. You then pay income tax on that benefit at your marginal rate, 20%, 40% or 45%.
What counts towards the P11D value?
The list price including VAT and delivery, plus optional extras fitted before or at delivery, such as metallic paint, upgraded wheels or a tow bar. Accessories added later above £100 also count. The road fund licence and the first registration fee are excluded.
What is a capital contribution?
It is a one-off payment you make towards the cost of the car, capped at £5,000 for this purpose. It reduces the P11D value, and therefore the benefit and the tax, every year you keep the car. It is different from a monthly contribution towards private use, which is treated separately.
Why are electric cars so much cheaper to run as company cars?
Their appropriate percentage is very low compared with petrol and diesel, so even a high P11D value produces a small benefit. That keeps the tax low. The percentage for electric cars is set to rise gradually over the coming years, so the advantage narrows but does not disappear.