Director at 50%, BMW X1 sDrive18i (€41,000, 143 g)
Annual tax on the benefit in kind
€2,249/year
- Annual benefit in kind
- €4,498.00
- Tax per month
- €187.42
Free calculator · Company car · 2026
Income tax calculator: what your car costs you (or saves you) in tax
A benefit in kind is not a deduction from pay: it is a taxable base. What you really pay is the benefit in kind multiplied by your marginal rate. Conversely, a self-employed person who deducts their car expenses saves the corresponding tax.
Your parameters
Examples:
Tax on the benefit in kind of my company car
Highest bracket of your income: 45% above €24,480 net taxable, 50% above €48,320 (2026 income).
€
g/km
months
€
Amount you pay the company for private use: it reduces the taxable benefit in kind.
Result
Annual tax on the benefit in kind
€1,823/year
- Annual benefit in kind
- €4,050.00
- Tax per month
- €151.88
By marginal rate
| Marginal rate | Annual amount |
|---|---|
| 25% | €1,013 |
| 40% | €1,620 |
| 45% | €1,823 |
| 50% | €2,025 |
Calculate the full true cost
The full calculation adds up the cost for the company and the cost for the director, or calculates the net cost after deduction for a self-employed person, item by item.
Worked examples 2026
Calculated by the same engine as the full true cost calculation, never estimated by an AI.
Employee at 45%, Tesla Model 3 with €100/month contribution
Annual tax on the benefit in kind
€221/year
- Annual benefit in kind
- €1,690.00
- Personal contribution deducted
- €1,200/year
- Net taxable benefit in kind
- €490.00
Self-employed at 50%, electric, €9,000 of expenses at 80% business
Annual tax saving
€3,600/year
- Deductibility rate
- 100.0%
- Business share of expenses
- €7,200/year
- Actually deductible expenses
- €7,200/year
How it is calculated
Employee / director: tax = (annual benefit in kind − personal contribution) × marginal income tax rate Self-employed: saving = annual expenses × business use × deductibility rate × marginal income tax rate Excluding municipal surcharges (≈ 7%) and the special social security contribution
For an employee or a director, the benefit in kind is added to taxable pay. Its true cost is therefore the additional tax it triggers, at your marginal rate: 45% or 50% for most managers and directors. A personal contribution paid to the company is deducted from the benefit in kind, euro for euro.
For a self-employed natural person, there is no benefit in kind on their own car: the limitation comes through the business share and the CO2 deductibility rate. Each euro of expenses deducted saves tax at the marginal rate.
Both calculations use the same sub-engines as the TCO (benefit in kind and deductibility). Municipal surcharges and the special contribution are not modelled: the actual amount is slightly higher.
Frequently asked questions
How much does a company car really cost me?
If the benefit in kind is €3,000 and your marginal rate is 50%, you pay €1,500 of tax per year, i.e. €125 per month, plus municipal surcharges. This is generally far less than an equivalent private car, for which you would bear every cost.
Does a personal contribution reduce the tax?
Yes: the contribution paid to the employer for private use is deducted from the benefit in kind. A contribution of €100 per month reduces the taxable benefit in kind by €1,200 per year. If the contribution exceeds the benefit in kind, it falls to zero.
Which marginal rate should I choose?
The one of your highest income bracket: 40% between €15,820 and €27,920, 45% up to €48,320, 50% above (2026 income, indexed amounts). If in doubt, use 45%.
Does a self-employed person pay a benefit in kind on their car?
No. The benefit in kind only applies to vehicles provided by a company. A self-employed natural person deducts their car expenses in proportion to business use and at the CO2 deductibility rate; private use is simply not deductible.
Going further
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