As an employer, if you provide company cars or fuel for your employees’ private use, you’ll need to work out the taxable value so you can report this to HM Revenue and Customs (HMRC).
‘Private use’ includes employees’ journeys between home and work, unless they’re travelling to a temporary place of work.
Work out taxable value
You can calculate taxable value using commercial payroll software.
Or you can use HMRC’s company car and car fuel benefit calculator if it works in your browser.
Choose fuel type ‘E’ for electric cars. Choose fuel type ‘A’ for diesel cars that meet the Real Driving Emissions 2 standard (also known as Euro 6d) if you’re calculating taxable value for the 2018 to 2019 tax year.
Do not use the calculator if you’ve provided a company car through an optional remuneration arrangement (sometimes known as salary sacrifice). You can work out the taxable value on P11D working sheet 2b.
Work out the value manually
You can also work out the value manually on P11D working sheet 2. You’ll have to use this method if both of the following apply during the tax year you’re reporting on:
- the car was unavailable for at least 30 consecutive days
- you were providing fuel for private use, but stopped doing this
Taxable value of cars
The taxable value of a car is not the same as its cost. The taxable value also depends on: