Company Car Tax for BMW Business Users

At Snows Portsmouth and Isle of Wight

For business users, there has never been a better time to make the switch to Plug-in Hybrid or all electric vehicles. BMW Fleet & Business Sales offers company car drivers a strong range of highly specified models and comprehensive options, combined with low running costs, as a result of fuel and emissions-saving technology.

Company car Benefit-in-Kind (BIK) tax is based on a vehicle's P11D price and CO2 Emissions. Cars with a CO2 emission of 1-50g/km, the distance they can cover with zero emissions affects the tax liabilities. Cars registered before 6 April 2021 are taxed according to the bands shown in Table 1 below.

New car registrations after 6 April 2020 use WLTP 202 figures, shown in Table 2.

Table 1: Source: HMRC. Figures in brackets apply to diesels. Diesel hybrids and diesel cars that meet the Real Driving Emissions Step 2 (RDE2) standard are exempt from the diesel tax charge. Measured in miles

Table 2: Source: HMRC. Figures in brackets apply to diesels. Diesel hybrids and diesel cars that meet the Real Driving Emissions Step 2 (RDE2) standard are exempt from the diesel tax charge. 1 Measured in miles

BIK tax liability calculation – new cars from 6 April 2020.

For example, a new BMW 118i M Sport 5dr first registered after 6 April 2020 has a P11D price of £26,965 and WLTP-derived CO2 emissions of 139g/km, putting it in the 30% BIK band in 2020/21. £26,965 x 30% gives a taxable value of £8,090, equating to yearly BIK tax of £1,618 (£135/month) for a 20% tax payer, or £3,236 a year (£270/month) for a 40% tax payer.

Compare Company Car Tax

The way in which BMW vehicles are treated under the current tax regime renders the optimal choice for many business users a very easy decision. All models within the standard- wheelbase PHEV range offer a BIK rate in the current tax year of 10\% or less. This gives company car drivers significantly reduced company car tax, as well as their employers via lower National Insurance contributions.

BENEFITS: THINGS TO KNOW ABOUT BMW BUSINESS

FUEL ALLOWANCES

The 'free' fuel benefit.
BIK tax is payable by drivers receiving employer-provided 'free' fuel for private mileage in a company car. To calculate this, the Fuel Benefit Charge is used, equaling £24,500 from 06/04/2020.

If you need guidance on how to calculate the tax due on 'free' fuel, simply contact our Corporate team at Snows BMW Portsmouth and they can happily explain.

GOVERNMENT PLUG-IN GRANT

The Government Plug-in Grant for ultra-low emissions vehilcles is available only to cars with zero emissions of CO2, of which BMW i3 and i3s models are eligible. The grant is a maximum of £3,000 per car.

This grant is discounted off the price of the vehicle when you purchase from Snows. Contact us to find out more.

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