Company Car BIK in Ireland (2026)
If your company provides you with a car, you're taxed on the private use of it through Benefit-in-Kind (BIK). How much depends on the car's value, its CO2 emissions, and how many business kilometres you drive. This guide explains exactly how 2026 BIK is calculated, sets out the current Revenue tables, covers the temporary OMV relief, shows how electric cars are treated, and explains why you can't claim mileage and run a company car for the same journeys.
Rates change with every Budget and Finance Act. The figures below were taken directly from Revenue and verified in June 2026. This is general information, not tax advice — always confirm the current position on Revenue.ie before calculating an actual liability.
How Company Car BIK Is Calculated
The taxable amount is called the cash equivalent. The formula is straightforward; the inputs are where it gets detailed.
Cash equivalent = (OMV − reduction) × applicable %
OMV — Original Market Value
The list price of the car when new (including VAT and VRT), regardless of what was actually paid or whether the car is second-hand.
CO2 category
The car's emissions place it in a category from A1 (zero emissions) to E (highest). Lower emissions mean a lower percentage.
Business mileage band
Your business kilometres for the year set which band applies — more business mileage gives a lower percentage. The cash equivalent is then added to your pay and taxed via PAYE, USC, and PRSI.
2026 Rates: CO2 Categories & Mileage Bands
CO2 emissions categories
| Category | CO2 emissions |
|---|---|
| A1 | 0g/km (zero emissions) |
| A | More than 0g/km up to and including 59g/km |
| B | More than 59g/km up to and including 99g/km |
| C | More than 99g/km up to and including 139g/km |
| D | More than 139g/km up to and including 179g/km |
| E | More than 179g/km |
Category A1 (zero-emission) was introduced from 1 January 2026.
Percentage of OMV by business mileage band
| Business km | A1 | A | B | C | D | E |
|---|---|---|---|---|---|---|
| 0 – 26,000 | 15% | 22.5% | 26.25% | 30% | 33.75% | 37.5% |
| 26,001 – 39,000 | 12% | 18% | 21% | 24% | 27% | 30% |
| 39,001 – 48,000 | 9% | 13.5% | 15.75% | 18% | 20.25% | 22.5% |
| 48,001 + | 6% | 9% | 10.5% | 12% | 13.5% | 15% |
Revenue company car BIK tables, verified June 2026. The lower limit of the highest mileage band is 48,001 km.
The Temporary OMV Reduction
To cushion the BIK regime introduced in 2023, a temporary reduction to the OMV has been extended — and it is now tapering out.
- A reduction is applied to the OMV before the percentage is calculated: €10,000 for 2026, then €5,000 for 2027 and €2,500 for 2028.
- It applies to cars in categories A1, A, B, C and D (and all vans).
- There is no €10,000 reduction for a Category E car (over 179g/km).
- The lower limit of the highest business-mileage band remains at 48,001 km.
A further concession applies for employees with lower annual business mileage; the conditions are set by Revenue, so check the current detail on Revenue.ie if it may apply to you.
How Electric Cars Are Treated
A fully electric (zero-emission) car falls into the new Category A1 — the lowest percentage band — and gets an extra OMV reduction on top of the universal one.
EV OMV reductions for 2026
A zero-emission car gets both reductions stacked:
- €10,000 universal reduction, plus
- an additional €20,000 EV reduction for 2026
- = €30,000 off the OMV before applying the A1 percentage.
Why it matters
Combining the lowest percentage band (A1) with a €30,000 OMV reduction makes the BIK on an electric company car dramatically lower than on an equivalent petrol or diesel car. Note the EV-specific reduction has been tapering each year, so always confirm the figure for the year in question.
Worked Examples (2026)
Petrol car — Category D
OMV €40,000 · 150g/km (Category D) · 32,000 business km (band 26,001–39,000 → 27%).
OMV − €10,000 = €30,000
€30,000 × 27% = €8,100
Taxable BIK: €8,100 / year
Added to pay and taxed through PAYE, USC, and PRSI.
Electric car — Category A1
OMV €55,000 · 0g/km (Category A1) · 32,000 business km (band 26,001–39,000 → 12%).
OMV − €10,000 − €20,000 = €25,000
€25,000 × 12% = €3,000
Taxable BIK: €3,000 / year
A higher-value EV produces a far smaller BIK than the cheaper petrol car above.
Illustrative examples using the 2026 figures above. Your actual figures depend on the exact OMV, CO2 rating, and verified business mileage — confirm on Revenue.ie.
You Can't Claim Mileage AND Have a Company Car
This is the point most often misunderstood. Civil service mileage rates reimburse an employee for using their own vehicle. If you drive a company car, the company already provides the vehicle and bears its running costs — and you're taxed on BIK for the private use. You cannot also claim the civil service per-km mileage rate for business journeys in that same company car.
That trade-off — company car plus BIK, or own car plus mileage — is exactly the decision our company car vs personal car guide works through. (Genuine out-of-pocket business costs, like tolls or parking, can still be reimbursed separately — but not the flat mileage rate.)
How Expense.ie Helps
Keeps the two apart
Company-car drivers are flagged so the system never lets civil service mileage be claimed for the same travel — removing the most common BIK-related error.
Business mileage on record
For own-vehicle staff, year-to-date business mileage is tracked accurately — the same figure that drives both mileage bands and the BIK mileage band.
Clean records for payroll
Reimbursements and business travel are categorised and exportable, so payroll has what it needs and the position is defensible if Revenue asks.
Company Car BIK FAQ
Related Resources
Own Car or Company Car — Track It Right
Expense.ie keeps company-car BIK and own-vehicle mileage cleanly separate, tracks business mileage accurately, and produces records payroll and Revenue can rely on. For staff using their own cars, it applies the correct civil service rates automatically.
General information, not tax advice. Confirm current rates on Revenue.ie.