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Company car BIK calculator (Ireland, 2026)

Work out the taxable benefit of a company car or van for 2026 and how much to add to each payslip. It uses Revenue's 2026 rules and the same calculation PayFlow uses in payroll.

How company car BIK works in 2026

A company car or van that an employee can use privately is a benefit-in-kind (BIK). Its value is added to pay and taxed through payroll every pay day. For 2026:

  1. Start with the original market value (OMV): the list price including VAT and VRT, before discounts.
  2. Take off the 2026 reduction: €10,000 for cars in CO2 categories A1 to D and for all vans, plus a further €20,000 for an electric car or van. No reduction for category E.
  3. Multiply by a percentage: for cars it depends on the CO2 category and business kilometres (table below). Vans are always 8%.
  4. Part of the year: business kilometres are scaled up to a full year to pick the band, then the benefit is cut to the days the car was available.
  5. Take off what the employee pays the employer towards the car (not fuel or insurance they pay themselves).

Car percentages by CO2 category and business km

Business km a yearA1 (EV)ABCDE
Up to 26,00015%22.5%26.25%30%33.75%37.5%
26,001–39,00012%18%21%24%27%30%
39,001–48,0009%13.5%15.75%18%20.25%22.5%
Over 48,0006%9%10.5%12%13.5%15%

CO2 categories (g/km): A1 = 0, A = 1–59, B = 60–99, C = 100–139, D = 140–179, E = 180 and over.

Example

A petrol car with an OMV of €40,000, CO2 of 120 g/km (category C) and 15,000 business km. Value used: €40,000 − €10,000 = €30,000. Percentage: 30%. Benefit: €9,000 for the year, or €750 added to each monthly payslip.

The same price as a fully electric car: €40,000 − €30,000 = €10,000 at 15% = €1,500 for the year, or €125 a month.

Questions

Is the BIK paid in cash?

No. It is a notional amount added to taxable pay so PAYE, USC and PRSI are charged on it. The employee's net pay goes down by the tax on it, not by the benefit itself.

What if the employee has the car for only part of the year?

Enter the number of days. The calculator scales the business kilometres up to a full year to choose the percentage, then reduces the benefit to those days, as Revenue does.

Does this cover 2027?

No. These are the 2026 rules. We will add 2027 once Revenue confirms the figures.

This calculator is a guide using Revenue's published 2026 rules. It is not tax advice. For unusual cases (pool cars, shared cars, cars bought second-hand), check Revenue's guidance or ask your accountant. How PayFlow handles company cars in payroll.