Running Costs
If you’re looking for the most cost-effective company car, don’t forget the role that fuel economy should play in your decision.
A company car driver will often focus only on the cost of benefit-in-kind taxation. However, this might lead to a higher overall cost when private fuel costs are taken into account.
The below example compares a petrol and a diesel model with the same P11D value.
Although the petrol car offers lower benefit-in-kind taxation, when we consider the cost of private mileage, diesel is the lower cost option.
| |
Petrol |
Diesel |
| P11D |
£25,000 |
£25,000 |
| CO2(g/km) |
138 |
123 |
| BiK 2020/21 tax year |
30% |
31% |
| BiK 2021/22 tax year |
31% |
32% |
| BiK 2022/23 tax year |
32% |
33% |
| Total BiK tax (20% taxpayer) |
£4,650 |
£4,800 |
| MPG (Combined) |
44.5 |
53.3 |
| Annual private mileage |
7,500 |
7,500 |
| Fuel price / litre (p) |
125.9 |
133.9 |
| Total fuel cost |
£2,894 |
£2,569 |
| Total cost |
£7,544 |
£7,369 |