There has been a significant fall in company car drivers in 2022, according to the latest figures from HMRC.
According to the most recent benefit-in-kind (BIK) data, there were 80,000 fewer drivers paying company car tax over the same month compared to 2021. In September of last year there were 800,000 drivers paying BIK, and 720,000 last month. This continues the downward trend that has been evident since 2016 when there were 960,000 company car drivers.
The data also shows the continued electrification of the company car sector.
Electric vehicles represent a larger share of company fleets. 7% of BIK recipients were for EVs, and this figure looks almost certain to rise, encouraged by the low BIK tax rates for zero emission vehicles, introduced in 2020. In terms of emissions, only around 2% of company cars reported CO2 emissions in excess of 165g/km in 2020/21, according to the HMRC. There were also 137,000 recipients of company cars with CO2 emissions lower than 75g/km, an increase of 59,000 from the previous year.
The drop in the number of company car drivers in 2020/21, says HMRC, is expected to have been exacerbated by the Covid-19 pandemic, and associated reduction in economic activity. It is also likely to be a reflection of the rising fuel prices during most of this period.
The total taxable value of company car benefit was £4.62 billion in 2020/21, a decrease from £5.43bn in the preceding year.