Guides
Benefits in Kind and P11D Reporting
Benefits in Kind (BiKs) are non-cash perks you give employees, taxed via P11D or through payroll. Company cars are the most common BiK; rates depend on CO₂ emissions and list price.
Quick answers
What is a Benefit in Kind?
A non-cash perk provided to an employee or director — examples include company cars, private medical insurance, accommodation and interest-free loans over £10,000. The cash equivalent is added to the employee's taxable income, and the employer pays Class 1A NI at 15% (2025/26) on most BiKs.
When is the P11D due?
P11Ds for the previous tax year (ending 5 April) must be filed by 6 July, with a copy given to each employee by the same date. Class 1A NI on benefits is paid by 22 July (electronic) or 19 July (post). A P11D(b) summarises the total Class 1A liability.
How is company car BiK calculated?
Take the manufacturer's list price (including options and VAT) and multiply by the appropriate percentage based on CO₂ emissions and electric range. Pure electric cars are 3% in 2025/26 (4% in 2026/27 and 5% in 2027/28; later rates differ); high-emission petrols can hit 37%. Diesels not meeting RDE2 add 4% (capped at 37%).
What counts as a Benefit in Kind?
A BiK is anything of value provided to an employee or director that isn't cash salary — common examples include:
- Company cars and fuel
- Private medical insurance
- Living accommodation
- Interest-free loans over £10,000
- Gym memberships
- Beneficial relocation costs above £8,000
How BiKs are taxed
The cash equivalent of the benefit is added to the employee's taxable income. The employer also pays Class 1A NI at 15% (from April 2025) on most reported BiKs.
P11D reporting
For each employee receiving non-payrolled benefits:
- File a P11D by 6 July following the tax year
- Give the employee a copy of their P11D by 6 July
- Pay Class 1A NI by 22 July (electronic) / 19 July (post)
A summary form P11D(b) declares the total Class 1A liability.
Payrolling benefits — phased changes
Mandatory payrolling starts on 6 April 2027 for company cars, car fuel, vans, van fuel and employer-provided medical benefits. Most remaining benefits follow from April 2028; the date for employer-provided loans and accommodation is not yet confirmed. Payrolling remains voluntary for 2026/27. See HMRC guidance.
Company car BiK rates
The taxable benefit is list price × appropriate percentage (based on CO₂ emissions and electric range).
2025/26 highlights
| Vehicle type | BiK % |
|---|---|
| Pure electric (0 g/km) | 3% |
| Plug-in hybrids (1–50 g/km, depending on electric range) | 5–17% |
| Petrol/diesel — varies with CO₂ | up to 37% |
Diesel cars not meeting RDE2 standards add 4% (capped at 37%).
EV BiK rates rise gradually: 4% in 2026/27, 5% in 2027/28.
Car fuel benefit
If the employer pays for private fuel in a company car, an additional benefit applies:
- 2025/26 multiplier: £28,200 × the same CO₂ percentage as the car
- No fuel benefit for pure electric cars (electricity is not classed as fuel)
Trivial benefits exemption
A benefit is exempt from BiK if all of the following apply:
- Costs ≤ £50 per recipient (including VAT)
- Not cash or a cash voucher
- Not a reward for work or performance
- Not in the terms of the contract
- Annual cap of £300 for directors of close companies
Common exemptions
- One mobile phone per employee
- Workplace parking
- Pension contributions
- Reasonable business travel and subsistence
- Eye tests for VDU users
General guidance, not tax advice. Speak to a qualified accountant for advice tailored to your situation. Figures relate to the 2025/26 UK tax year. Source: HMRC, gov.uk.
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Example: Company Car Benefit in Kind Calculation
A side-by-side BiK calculation for a £45,000 petrol car and a £45,000 electric car, showing the dramatic difference in employee income tax and employer Class 1A NI in 2025/26.
Reference: HMRC Forms Glossary
What CT600, SA100, SA103, VAT100, P60, P11D, P45 and other common HMRC forms are for, and who needs to use them.