You’ll pay tax if you or your family use a company car privately, including for commuting. You pay tax on the value to you of the company car, which depends on things like how much it would cost to buy and the type of fuel it uses. This value of the car is reduced if: you have it part-time you pay something towards its cost it has low CO2 emissions If your employer pays for fuel you use for personal journeys, you’ll pay tax on this separately. If you drive a hybrid If your company car has CO2 emissions of 1 to 50g/km, the value of the car is based on its zero emission mileage figure, or ‘electric range’. This is the distance the car can go on electric power before its batteries need recharging. Contact your employer to find out your car’s zero emission mileage figure. Check or update your company car tax Tell HM Revenue and Customs ( HMRC ) if your car or fuel details change. You can check or update your company car tax online , for example if: you get a company car or give one back your employer starts or stops paying for fuel for you to use personally If a change affects the value of the car, HMRC will update your tax code so you pay the right tax. Estimating the tax you’ll pay You can see how much tax you might pay with HMRC ’s company car and fuel benefit calculator. This calculator may not work in all browsers. Find out how to update or change your browser .

Other company benefits you'll pay tax on

You pay tax on the value of the benefit to you, which your employer works out. Check your Income Tax to see how company benefits affect the tax you pay. Medical insurance You usually pay tax on the cost of the insurance premiums if your employer pays for your medical insurance. Check how your employer works out how much tax to deduct from your pay. You can get some tax-free health benefits from your employer, including: medical insurance when you’re working abroad annual check-ups Check and report changes to medical insurance paid for by your employer. Loans You’ll pay tax on low-interest or interest-free loans from your employer if they’re worth more than £10,000. You pay tax on the difference between the interest rate you pay to your employer and the official rate of interest set by the Bank of England. You may pay tax if your employer lends money to one of your relatives. Check how your employer works out how much tax to deduct from your pay. Living accommodation If you (or one of your relatives) is living in accommodation provided by your employer you may pay tax. How the tax is worked out depends on whether the accommodation cost more than £75,000. Check how your employer works out how much tax to deduct from your pay. You may not pay tax if you get the accommodation so you can do your job, or do your job better, for example agricultural workers living on farms. Help with your Self Assessment Use the living accommodation helpsheet if you need help with the ‘Employment’ section of your Self Assessment tax return.

Tax-free company benefits

You can get some company benefits tax free, including: meals in a staff canteen hot drinks and water at work a mobile phone workplace parking Christmas parties can also be tax free if they cost £150 or less per head and are open to all employees. Your employer might provide tax free childcare support , including childcare vouchers.

National Insurance on company benefits

You do not usually have to pay National Insurance on benefits you get from your job. Your employer will pay National Insurance contributions on them instead. But you do have to pay National Insurance on things that are paid in cash, as they’re treated as earnings. For example, if your employer gives you a gift that you could sell instead of keep, you will pay National Insurance on the value of the gift.

Keeping records and reporting changes

At the end of each tax year, your employer will give you details of the company benefits they’ve told HM Revenue and Customs ( HMRC ) about. They might give you a copy of your P11D form , if they sent one to HMRC . You must keep these details for 2 years after the tax year they relate to. Tell HMRC about starting or stopping company benefits You must tell HMRC about any benefits you or your family start or stop getting from work - even if your employer has already taken Income Tax and National Insurance for them. You should only tell HMRC that you’ve got a company car once you’ve started using it.

Tax on company benefits

Q: Overview

As an employee, you pay tax on company benefits like cars , accommodation and loans . Your employer takes the tax you owe from your wages through Pay As You Earn ( PAYE ). The amount you pay depends on what kind of benefits you get and their value, which your employer works out. Check your Income Tax to see how company benefits affect the tax you pay. Some company benefits can be tax-free , like childcare and canteen meals. You have to pay tax and National Insurance on things that are paid in cash, as they’re treated as earnings.

Overview

As an employee, you pay tax on company benefits like cars, accommodation and loans.

Your employer takes the tax you owe from your wages through Pay As You Earn (PAYE).

The amount you pay depends on what kind of benefits you get and their value, which your employer works out.

Check your Income Tax to see how company benefits affect the tax you pay.

Some company benefits can be tax-free, like childcare and canteen meals.

You have to pay tax and National Insurance on things that are paid in cash, as they’re treated as earnings.

View a printable version of the whole guide

Tax on company benefits

Overview

Is this page useful?

Help us improve GOV.UK

Help us improve GOV.UK

Cookies on GOV.UK

Tax on company benefits

Overview

Related content

Is this page useful?

Help us improve GOV.UK

Help us improve GOV.UK