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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