In need of a new company car?
How about leasing it?
Unlike with PCP or HP, there's no expectation that you might go on to own the car, and you probably don't want to. Plus, with leasing, it's more flexible in that you'll be able to switch to a new high-performance car every couple of years.
So, whether it's a saloon or an SUV, or petrol or electric power, there's plenty of lease company cars around to suit your business needs.
But . . . with budgets and that all-important Benefit in Kind tax (BiK) to consider, choosing the right company car be a bit of a minefield at times. Luckily, we've picked out some of the best company cars so that you don't have to.
How to Find the Best Company Car
A couple of major factors you should look for in the best company cars.
The ideal company car has to be comfy, spacious and with enough features and tech to inject some comfort into those long commutes and business trips. That much is obvious. It should be loaded with enough features to help ease those daily driving stresses to and from work. And if it's an electric car, it should be able to charge quickly enough to be able to get back onto the roads in no time.
The other thing that you should be looking for is a good BiK (Benefit in Kind) company car tax rate. What this does is determine how much of your salary goes towards your company car. It's a tax on perks which do not make up part of your salary – a company car being one of these. The amount of BIK that company car drivers contribute is determined by:
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Your rate of income tax (either 20% or 40%)
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The official amount of CO2 emissions that your car emits whilst driving
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The P11D value of the car, which is the vehicle's list price as well as VAT and any optional extras, but not including the first registration fee and road tax
Note: BiK rates are different for Scotland
Is Petrol Or Diesel Better For A Company Car?
Diesel used to be the prime choice for company car drivers, but that's no longer the case.
It’s the above-mentioned BiK rates, plus changes related to emissions outputs, that have seen diesel-powered cars fall from grace. The honest truth is that they're no longer wallet-friendly options for running a company car.
In the present day, a diesel model that doesn’t comply with RDE2 standards incurs a 4% BiK surcharge (up to 37%) over petrol models with an identical emissions figure, which isn't good! This means that you will need to consider if you actually drive enough miles to justify the amount you’d save in fuel over the higher BiK cost and related income tax.
With diesel power gradually falling out of favour, what are the cheap alternatives? In recent years, petrol, hybrid, plug-in hybrid, and electric cars have all become increasingly popular with company-car drivers thanks to more beneficial BiK tax rates. For 2022-23, business users of electric cars pay just 2% BiK tax. By comparison, a former company-car favourite, the Skoda Superb, now attracts a steep 38% BiK rate when specced with a 2.0-litre TDI diesel engine. So, although alternative fuel models may come with a larger price tag, they’ll end up saving you money in the long term.
And with that in mind, here's our pick of the bunch . . .
BMW 3 Series 330e
The 3-Series BMW A fine executive saloon, it only feels natural to shortlist the BMW 3 Series 330e in the company car lineup. Much like the regular model, it's comfy and still a sheer joy to drive. There's a lot of room inside, but do be aware of the slightly smaller boot (375-litres). But in practical affairs, BMW has made up for that with a low BiK rate of just 10%.
With this electric/plug-in hybrid petrol 330e model, the conventional 320i car's 184hp 2.0-litre petrol engine is matched with a larger battery and an electric motor, culminating in one well-rounded package. You get the choice of either a Touring estate or a saloon, both of which can be specified with an xDrive powertrain. We should also point out that this updated model range gets a more sophisticated cabin and smarter looks. Not to mention an all-electric driving range of up to 37.3 miles when the car is fully charged up.
KIA Niro EV/KIA e-Niro
Another electric car worth a glance if you’re out shopping for your next company car is the latest Kia Niro EV. One of a number of vehicle that's still offered with a choice of drivetrain, you can get it in hybrid, plug-in hybrid or full electric guises. The EV version has long impressed.
The new Niro EV is even better than before, as while the battery range of 285 or so miles is pretty much the same as its predecessor (and a decent figure in itself), this one has really sharpened up the exterior looks, giving the KIA a slice of added character.
Tesla Model 3
A new electric vehicle that works perfectly well for business purposes (or just about any purpose, to be honest). Whilst it doesn't have quite as much passenger space as the BMW 3 Series due to the car's huge batteries, a major selling point of the Tesla Model 3 is its low BiK rates. Unlike the Volkswagen ID. 3, it has no tailpipes and is low-emission.
It's arguably the car that really put Tesla on the map. Needless to say, it's all-electric, but also much more accessible than the brand's previous models. Businesspeople . . . form an orderly queue.
Range Rover Evoque (P300e PHEV)
Of the current batch of plug-in Land Rovers, it’s the Range Rover Evoque P300e that's got to be on your radar if you’re thinking of having a 4×4 as your next company car. Relaxing to drive and with a good, high-quality interior, it's not one to pass over. However, as with all plug-in hybrids, you're going to need regular access to a charger in order to enjoy the full benefits of the hybrid set up.
The main draw of the P300e is the fact that it has by far the lowest company car tax rates of any Evoque on the market at the minute. Whereas every other Range Rover Evoque model is hit by lofty BiK rates of 37%, the P300e version is going to set company car drivers back 12% thanks to its low CO2 emissions and an official range of 38 miles in all-electric mode.
Skoda Superb iV
If more room and practicality is what you need from a company vehicle, then you can't go far wrong with the Skoda Superb iV. Few cars this small can match the Superb for boot capacity or cabin size. Plus, thanks to its well-equipped interior and comfy ride, it also makes for a comfortable commute, though the Volkswagen Passat is arguably still a bit comfier (sorry, Superb).
This vehicle's low CO2 emission rate means that the Superb iV has a BiK rate of just 12% – though this will increase to 13% for the 2025/26 period before hitting 15% by the 27/28 financial year. Although there are plenty of engine options available with the Superb, we'd definitely recommend the plug-in hybrid options if you're a company car driver.
Simply superb.
Ford Mustang Mach-E
It's the Ford Mustang, but probably not as you know it. Now available for the first time as a zero-emission electric SUV, this is an adventurous and bold take on everybody's favourite muscle car. Its exterior takes stylistic cues from the standard Mustang we're all familiar with, but the interior is reassuringly tech-heavy and modern, putting the Mach-E on an equal playing field with its Tesla Model Y and Audi E-Tron rivals.
The standard range trim will take you up to 273 miles on one full charge, whereas the extended range can take you on an impressive 379 miles. In terms of top speed, you're looking at 112mph for both and a 0-60mph time that's pretty much the same as well, at around 6 seconds. The powerful GT trim shortens that time dramatically to 3.5 seconds and boasts a top speed of 124mph, so if you're one who regularly feels the need for speed, then that version's a no-brainer. And with a 502-litre boot space that extends to 1420-litres with the rear seats folded down, it's fair to say things can be fairly roomy up the back.
Volvo XC40 T5 Recharge
Not every environmentally-friendly company car has got to be a big saloon – as the plug-in hybrid versions of the Volvo XC40 also show that you have other options if you’d prefer an SUV that's more stylish. Best of all, the Volvo provides all the comfort and is relaxing to drive over long distances. Also, unlike with some other plug-in hybrid cars, the boot space hasn’t been sacrificed by the need to package a large battery pack.
The only possible downside is that the XC40 PHEV covers an electric-only range of 28.6 miles on electric battery power. Whilst that should still be OK in terms of short everyday use, its inability to break the 30-mile barrier means that you won't be making many motorway journeys and also that the vehicle gets a slightly higher BiK rate of 14% rather than 12%, therefore impacting your tax liabilities. Just something to think about ...
Volkswagen ID.3
If you want something more affordable and economical whilst still going down the all-electric route, then the Volkswagen ID. 3 could be right up your street. As an EV, it's seen low BiK rates for 2022/3 and the following two financial years, though this percentage rate is expected to rise to 3% in 2025/6 and to 4% in 2027/8. But EVs like this will still have significantly better BiK rates compared to petrol and diesel cars, and even plug-in hybrids.
Such is the ID.3's popularity that it's become almost synonymous with Volkswagen in recent years, being spacious, comfortable to drive and with a decent electric range too of over 200 miles. Its interior may not be quite as plush as that of the conventional VW Golf, but it still gets the job done.
Hyundai IONIQ 5
However retro it might look with its 8-bit inspired lights, there's not much that's old-fashioned about the Hyundai IONIQ 5. As a fully electric car, it boasts the latest in charging and battery technology, being a true EV from the ground up. And featuring one of the largest battery packs around, it also has a range of up to 298 miles, taking you on any long motorway trip without having to charge.
Trips further afield will also be made more doable with the vehicle ultra-rapid 350kW charging, which till now was only available on more 'exotic' EV models. But for those happy to linger near home, the entry-level IONIQ 5 still gets a respectable electric-only range of up to 238 miles from its 58kW battery and 168bhp electric motor. There's even a dual-motor version, with a 0-62mph time of 5.2 seconds and 301bhp.
Toyota Corolla Hybrid
Toyota has been a supporter of petrol-electric power for a long time, so it's no surprise that the brand's hybrid Corolla is a prime choice if you're looking for an eco-friendly company car that still has a bit of the old engine power. It's especially worth it if you're in need of a relaxing drive and want a hybrid. Half-petrol, half-electric, it's on a mission to be all things to all people.
Because this Corolla is a conventional hybrid rather than a plug-in hybrid, it should also make it a bit easier to match Toyota’s claimed fuel economy of up to 62mpg in day-to-day driving.
Summary
Well, there you have it! Some of the best company cars around.
Business moves fast. So can you.