What is company-car tax?
THE Government considers that providing employees with a car that can be used for personal trips – including commuting – is a ‘perk’, which should be taxed as though it is income. If you are only allowed to drive the car for work mileage, though, there’s no benefit, so you won’t be liable for company-car tax.
These company-provided cars have a ‘Benefit-in-Kind’ (BiK) tax imposed, which means money will be deducted from your salary before it hits your bank account.
The rate you are taxed depends on a complicated calculation, which takes into account number of factors.
These include:
