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P11D value explained

  • What P11D means
  • How your P11D value is calculated
  • Using P11D value to calculate BIK tax

The P11D value of your car is used to calculate the amount of company car tax you pay.

P11D is actually the name of a form filed by employers and sent to the tax office with which their Pay As You Earn scheme is registered.

The P11D value of your car comprises the list price, including VAT, plus any delivery charges, but does not include the car's first registration fee or its annual road tax.

Some manufacturers' pricing does not contain a specific delivery charge, but it won't make a difference to your tax bill compared with equivalent models from other brands because they would be benchmarked at the on-the-road price.

For example, car A is priced at £15,480 on the road. It is made up of £14,655 list price (basic price plus VAT), £645 delivery fees, £125 annual Vehicle Excise Duty and £55 first registration fee.

Its P11D value would be £15,300 - list price plus delivery fees, but without road tax and first registration fee.

Meanwhile, car B is also priced at £15,480 on the road. Its manufacturer does not list a separate delivery charge, but the list price is stated as £15,275. It is subject to VED at £150 a year, and a first registration fee of £55. Therefore the P11D value is £15,275.

Choosing factory-fit options in your company car will have a direct impact on its P11D value, with the full value of the option contributing to the total.

To calculate annual company car tax the P11D value is multiplied by the percentage rate of income tax you pay (20% or 40%) and by the benefit-in-kind tax band dictated by the car's carbon dioxide emissions.

A list of current BIK tax bands can be found here, while our company car tax calculator can be found here.

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