P11D value calculator
A company car's tax for 2026/27 starts from its P11D value. On a car with a £36,300 P11D value taxed at 25%, the taxable Benefit-in-Kind is an estimated £9,075 a year, under gov.uk's rules for company car tax, and the tax due depends on your income tax rate.
How is a company car's P11D value calculated?
The P11D value starts from the list price the manufacturer published for the car when new, including VAT and delivery, under gov.uk's rules for expenses and benefits on company cars.
This is the notional list price, not the discounted deal an employer negotiated, which is why the P11D value often sits above the invoice.
Factory-fitted options such as metallic paint or a bigger alloy set are added to the list price, because gov.uk treats them as part of the taxable price.
A capital contribution the employee has paid is then deducted, up to a limit, before the P11D value is fixed, under the same gov.uk guidance.
To turn the P11D value into a Benefit-in-Kind, gov.uk's rules for calculating tax on company cars multiply it by the appropriate percentage for the car, set by its CO2 emissions and, for plug-in hybrids and electric cars, the electric-only range.
Income tax is then charged on that Benefit-in-Kind at the employee's own marginal rate.
What tax would I pay on an example company car?
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% appropriate percentage, set under gov.uk's rules for calculating tax on company cars, the taxable Benefit-in-Kind is £9,075 a year.
A taxpayer on the 40% rate would face an estimated £3,630 a year in tax on that benefit, or about £302.50 a month through the tax code.
Dropping the percentage to an electric car's level lowers both the benefit and the estimated tax 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.
How is a company car's P11D value calculated?
gov.uk sets the P11D value as the manufacturer's list price when the car was new, including VAT and delivery, plus any factory-fitted options such as paint or upgraded wheels. Any capital contribution the employee has made, up to a limit, is deducted from that total. The result is multiplied by the car's appropriate percentage, based on CO2 emissions and electric range, to give the taxable Benefit-in-Kind.
What tax would I pay on an example company car?
On a £34,000 car with £1,500 of options and £800 delivery, the P11D value is an estimated £36,300. At a 25% appropriate percentage the taxable Benefit-in-Kind is £9,075 a year. A taxpayer on the 40% rate would face an estimated £3,630 a year in tax, following gov.uk's rules for calculating tax on company cars.
Sources & Rate Verification
Rates verified against official statutory guidance on 6 September 2026.