Company car tax (BIK) on a Tesla
Electric company cars have very low benefit-in-kind (BIK) rates, which is why so many Teslas are company cars or salary sacrifice cars.
BIK rates for fully electric cars
| Tax year | BIK rate |
|---|---|
| 2025/26 | 3% |
| 2026/27 | 4% |
| 2027/28 | 5% |
| 2028/29 | 7% |
| 2029/30 | 9% |
Rates can change at future Budgets. Check GOV.UK before committing to a long lease.
Worked example
A Tesla with a list price of £45,000 in 2026/27:
- Taxable benefit: £45,000 × 4% = £1,800.
- A basic-rate (20%) taxpayer pays £360 a year, or £30 a month.
- A higher-rate (40%) taxpayer pays £720 a year, or £60 a month.
Salary sacrifice
Many employers offer electric cars through salary sacrifice. You give up some salary before tax and National Insurance, and pay BIK on the car. Savings can be large, but check how it affects pensions, mortgages and other benefits linked to your salary.
Charging
Charging at work is not a taxable benefit for employees. Using a company charge card at public chargers, or the employer paying for home charging, has its own rules. Ask your payroll team.