When to change your company car
Company car tax rises every year to 2029/30, and plug-in hybrids jump in April 2028. See the tax on your car and a replacement, year by year, and what switching now saves.
Your answer
Enter both cars' list prices and your salary to see the tax year by year.
About this calculator
For employees and directors with a company car who are thinking about changing it, or switching to electric.
What happens to your answers
We don’t keep them. Your answers go to our server to do the sums and aren’t stored or logged. If you copy a link to your answers, they’re in the link itself, so only share it with people you trust.
How it’s worked out
A share of each car's list price is taxed as if it were pay. The share is set for each tax year to 2029/30. Electric cars go from 4% this year to 5%, 7% and then 9%. Plug-in hybrids are taxed by their electric range until April 2028, then on a flat 18% (19% in 2029/30). Cars under 75g/km also go up a point in April 2027. Everything else is held until April 2028, then rises 1 point a year to a top rate of 39%.
We work out your tax on each car for each year, add up the four years and take one from the other. We use today's income tax bands and your salary for every year: the tax-free allowance and the point where the higher rate starts are set at today's levels to 2030/31.
Worked example
Switching to the electric car saves you £15,180 in tax over 4 years.
2026/27 to 2029/30 · today's income tax bands every year · salary £60,000 · each car available all year
| 2026/27, current petrol car: 30% of £40,000 = £12,000 taxed as pay | £4,800 |
|---|---|
| 2027/28, current petrol car: 30% of £40,000 = £12,000 taxed as pay | £4,800 |
| 2028/29, current petrol car: 31% of £40,000 = £12,400 taxed as pay | £4,960 |
| 2029/30, current petrol car: 32% of £40,000 = £12,800 taxed as pay | £5,120 |
| Tax on your current petrol car over 4 years | £19,680 |
| 2026/27, replacement electric car: 4% of £45,000 = £1,800 taxed as pay | £720 |
| 2027/28, replacement electric car: 5% of £45,000 = £2,250 taxed as pay | £900 |
| 2028/29, replacement electric car: 7% of £45,000 = £3,150 taxed as pay | £1,260 |
| 2029/30, replacement electric car: 9% of £45,000 = £4,050 taxed as pay | £1,620 |
| Tax on the replacement electric car over 4 years | £4,500 |
| Switching now saves you | £15,180 |
Worked out using HMRC's published rates for the 2026/27 tax year (6 April 2026 to 5 April 2027), on a yearly basis.
Questions people ask
Why do plug-in hybrids cost more from April 2028?
Until then, a plug-in hybrid with a long electric range is taxed on a small share of its price. From 6 April 2028, every plug-in hybrid with 1 to 50g/km of CO2 is taxed on 18%, whatever its range, and 19% the year after.
My new plug-in hybrid shows more than 50g/km. Is that right?
Plug-in hybrids first registered since 1 January 2025 under the newer emissions test (Euro 6e-bis) can show higher CO2. For company car tax, HMRC treats an eligible one as 1g/km until 5 April 2028, or until 5 April 2031 if it was made available to you by then and the arrangement doesn't change. This calculator uses the figure you enter, so talk to us if it applies.
What if I switch partway through the year?
That year's tax is shared between the two cars by the number of days you had each. The yearly figures show how much each year is worth.
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