Car fuel benefit charges

What is the car fuel benefit charge? How do you apply it?

This is a freeview 'At a glance' guide to the car fuel benefit charge. 

The car fuel benefit charge:

• A director/employee who is provided with a Company car and also receives free petrol or diesel from their employer is taxed on the cash equivalent of the benefit each tax year.
• The car fuel benefit is fixed each year, according to the table below.
• This benefit charge is calculated by taking the Appropriate percentage, as worked out for car benefit purposes and multiplying by the fixed figure.
  • Percentages for electric and ultra-low emission cars emitting less than 75g of CO₂ per kilometre will increase by 1% in 2025-26, 2026-27 and 2027-28.
    • This will bring rates to a maximum of 5% for electric cars and 21% for ultra-low emission cars.
  • Rates for all other vehicle bands will be increased by 1% for 2025-26 up to a maximum percentage of 37%.
    • Rates will then be fixed for 2026-27 and 2027-28.
• Since 6 April 2018, there is no taxable benefit where electricity is provided for an electric car. Legislation was included in Finance Act 2019 with retrospective effect where the facilities are made available to all employees at the workplace. 

Examples of how the benefit is calculated are found in our guide to Company cars. 

Note that the benefits associated with a Company van are calculated differently.