calculators.ieAll calculators

Company car BIK calculator

2026 and 2027 rules

Work out the benefit in kind on a company car or van, and how much income tax, USC and PRSI it adds to your pay.

Tax year
Vehicle
Tax status
Benefit in kind a year 
BIK a month
 
Tax on it a month
 
Benefit in kind
Extra tax on your pay

This is an estimate for general information, based on the rates and rules described on this page. It is not financial, tax or legal advice and does not take account of your full circumstances. Check your own position with Revenue or a qualified tax adviser before making a decision. Terms of use.

Illustration for the company car bik calculator

Worked example

A €40,000 petrol car with CO2 of 120 g/km, 10,000 business km, 2026. It is category C. The value is reduced by €10,000 to €30,000, and the percentage for under 26,000 business km is 30%: BIK of €9,000 a year. For someone on €60,000 that adds €3,600.00 income tax, €270.00 USC and €381.38 PRSI, about €354 a month.

The same price as an electric car. The value is reduced by €30,000 to €10,000, and the category A1 rate is 15%: BIK of €1,500. In 2027 the reduction falls to €15,000, so the BIK rises to €3,750.

A €30,000 diesel van. 8% of €20,000 after the reduction: €1,600 a year.

How company car BIK is calculated

Since 2023, BIK on a car is its original market value, less any reduction, multiplied by a percentage set by its CO2 category and the business kilometres you drive in the year. Anything you pay your employer for the car comes off the result. The BIK is added to your pay for income tax, USC and PRSI, so the cost to you is your marginal rate on the BIK. The calculator works this out by comparing your pay with and without the BIK.

CO2 categories

CategoryCO2 (g/km)
A10
A1 to 59
B60 to 99
C100 to 139
D140 to 179
E180 or more

Percentage of the value

Business kmA1ABCDE
Up to 26,00015%22.5%26.25%30%33.75%37.5%
26,001 to 39,00012%18%21%24%27%30%
39,001 to 48,0009%13.5%15.75%18%20.25%22.5%
48,001 or more6%9%10.5%12%13.5%15%

Reductions to the value

YearCategories A1 to D, and vansExtra for electric
2026€10,000€20,000
2027€5,000€10,000
2028€2,500None

Category E cars get no reduction. The electric car reduction applies to category A1 cars (0 g/km) and electric vans; hybrids do not qualify. These reductions are already in law, and Budget 2027 did not change them.

Sources

Rates last checked 10 October 2026. Every figure is listed on rates and sources.

Figures marked as announced come from Budget 2027 and are not law until the Finance Act 2026 is signed.

Questions

What is the original market value (OMV)?
The list price of the car when new, including VAT and VRT, less any discount an ordinary retail buyer would get. It is the value used every year you have the car, even when the car is second hand or leased.
How do business kilometres reduce BIK?
The percentage falls as business kilometres rise: for a category C car it is 30% up to 26,000 km, then 24%, 18% and 12% above 48,000 km. Business kilometres do not include driving between home and your normal place of work.
Is there BIK on an electric company car?
Yes, but the value is reduced first. In 2026 an electric car gets €30,000 off its value (€20,000 for electric cars plus the €10,000 reduction for categories A1 to D). In 2027 this falls to €15,000. A cheaper electric car can have no BIK at all.
How is a company van taxed?
BIK on a van is 8% of its original market value, whatever the mileage, after the same €10,000 reduction in 2026. Electric vans get the extra electric vehicle reduction too. There is no BIK if the van is needed for work, you have to bring it home, and private use is forbidden and minimal.
Does paying something towards the car reduce BIK?
Yes. Any amount you pay your employer for the car, for example towards running costs or by salary deduction, comes off the BIK. A lump sum towards buying the car reduces the BIK in the first year only.
How is BIK collected?
Your employer adds the BIK to your pay each pay day, and income tax, USC and PRSI are charged on the total. The BIK itself is not paid to you, so your take-home pay goes down by the tax on it.
What if I only have the car for part of the year?
The BIK is reduced in proportion to the time the car is available to you, and the business kilometre bands are scaled down in the same way. This calculator works out a full year.

Related calculators