Private fuel benefit - opt in or out?

Perky356

Hi MSE Team

I’m about to start a new job and will be opting into the company car scheme. Got my head around BIK tax etc. but no idea where to start with private fuel benefit.

Does anyone know how to cost this up? I’m aware it is heavily taxed but can’t find the calculation anywhere. I am a 40% tax payer in a diesel Volvo doing 1500 private miles per month.

Thank you!

Perky

AdrianC

You need to know the P11D %age for your exact car, which depends on the CO2 figure.You pay your normal income tax rate on the nominal fuel value multiplied by the P11D %age. For this tax year, the nominal value is £23,400.


Let's say your particular car is 120-124g/km CO2 - 25% P11D this tax year - and you're a 40% tax payer, then you're paying £23,400 x 25% x 40% = £2,340/year tax.


1,500 private miles/mo = 18,000/year, so you'd break even at 13p/mile fuel, which at £1.30/litre is 45mpg.


Next year, the nominal value will go up, and so will the P11D percentage.

Perky356

Thanks v much AdrianC. The model will be 117g/km. Would you be able to tell me how this affects the maths please?

AdrianC

115-119g/km is 24% for 2018/19, and it'll be higher next year.

https://www.rossmartin.co.uk/employers/benefits-shares/242-c02-emissions-appropriate-percentages

Have you checked the CO2 figure for the model in general, or for your EXACT car?
https://vehicleenquiry.service.gov.uk/
Yours may well differ - options, mid-year changes etc.