Answers · UK 2025/26

What is the van benefit charge for 2026/27?

The van benefit charge for 2026/27 is £4,020 per year for unrestricted private use of an employer's van. This is a flat-rate benefit in kind value added to your taxable income. A basic-rate taxpayer pays £804 extra income tax; a higher-rate taxpayer pays £1,608.

Last updated: 27 June 2026Last reviewed: 27 June 2026How we verify

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When an employer provides a company van and allows unrestricted private use -- meaning the employee can use it for personal journeys beyond ordinary commuting -- HMRC treats this as a taxable benefit in kind with a flat-rate cash equivalent value. **2026/27 Van Benefit Charge** - Standard van benefit: **£4,020** - Van fuel benefit (if employer also pays for private fuel): **£769** These are flat rates regardless of the van's value, age, or CO2 emissions (unlike company cars, which use a percentage of list price). **Tax payable by the employee** The £4,020 van benefit is added to the employee's taxable income and taxed at their marginal rate: | Tax Band | Rate | Annual Tax on Van Benefit | |---|---|---| | Basic rate | 20% | £804 | | Higher rate | 40% | £1,608 | | Additional rate | 45% | £1,809 | If the employer also pays for private fuel in the van, add the fuel benefit tax: - Basic rate: £769 x 20% = £153.80 - Higher rate: £769 x 40% = £307.60 **Total cost example -- higher-rate taxpayer with fuel benefit** - Van benefit: £1,608 - Fuel benefit: £308 - **Total extra income tax: £1,916/year** **Employer's Class 1A NIC** The employer pays Class 1A NICs at 15% on the total benefit value: - Van only: £4,020 x 15% = £603 - Van + fuel: (£4,020 + £769) x 15% = £718.35 **Exemptions -- restricted private use** No van benefit charge applies if private use is genuinely restricted -- for example, the van is driven home for operational reasons but employees are contractually prohibited from other private use and this is monitored. Ordinary commuting alone does not trigger the benefit; it is the right to use the van privately that creates the charge. **Zero-emission vans** Zero-emission vans currently attract a reduced benefit charge. Check HMRC's current guidance, as the rate applicable to electric vans has changed in recent years and may differ from the standard £4,020 figure.