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Best company cars (2021)

Picking the right company car for you can be tricky. Not only are there loads of great options out there, but they also need to cover lots of bases really well – they need to be comfy, spacious and have enough tech and features to take the sting out of long commutes and business trip journeys, while also having low Benefit-in-Kind (BiK) liability rates that help reduce how much of your salary goes towards your company car.

Diesel cars were once the go-to choice for company car buyers, thanks to the tax benefit those cars enjoyed in previous years – diesel cars generally have lower CO2 emissions than petrol-powered cars. Things have moved on and now company car tax favours electrified cars over diesel. So the cars in this list are a mix of plug-in hybrid cars, full hybrids and electric cars.

  • BMW 3 Series (BMW 330e)
  • Volkswagen ID.3
  • Tesla Model 3
  • Skoda Superb iV
  • Volvo XC40 (T5 Recharge)
  • Kia e-Niro
  • Range Rover Evoque (P300e PHEV)
  • Mercedes A-Class (A250e)
  • Toyota Corolla
  • Audi A6 (TFSI e)

BMW 3 Series 330e

The BMW 3 Series is already a great executive saloon pick, so it makes sense that the plug-in hybrid 330e version is worth shortlisting if you’re after a well-rounded company car. Just like the regular version, it manages to be comfy while also being fun to drive, and there’s a good amount of interior space, too – though do bear in mind that the 330e’s boot is quite a bit smaller than the one on the regular 3 Series, due to the way the battery is stored under the boot floor.

Where the BMW 330e loses ground in the practicality stakes, it claws back some ground with its very low BiK rates of 10%. In comparison, the regular BMW 3 Series’ BiK rates range from 26% to 37%, depending on the spec and what the engine is under the bonnet.


Volkswagen ID.3

If you’d rather go down the all-electric route with your next company car, the Volkswagen ID.3 could be the right car for you. As an electric car, it has a 0% Benefit-in-Kind rate for 2020-21, rising to 1% in 2021-22, so it’s more attractive financially than a petrol or diesel car.

It’s also spacious, comfortable to drive and has a decent range too. Its interior is not quite as plush as the one you’ll find the conventional VW Golf and the touch-sensitive controls are a bit fiddly to use, especially while driving.

Tesla Model 3

The Tesla Model 3 is another EV that could make a great choice as a company car. While it doesn’t have quite the same amount of passenger space the BMW 3 Series, it’s still quite roomy inside and, thanks to the car’s big battery pack, you should be able to cover a good amount of ground before you need to think about charging the Tesla up.

Arguably the Model 3’s big selling point for company car drivers is its very low BiK rates. Because it has zero tailpipe emissions, the Tesla is exempt from any additional company car tax charges for the 2020/2021 tax year, and just a 1% rate will be applied during the 2021/2022 tax year.


Skoda Superb iV

When it comes to getting the most amount of room and practicality from a company car, there are worse options out there than the Skoda Superb. Few cars of this size can beat the Skoda when it comes to cabin space and boot capacity. Plus, thanks to its comfy ride and well-equipped interior, it’s a nice car to commute – though the Volkswagen Passat is comfier still and, if you’re after something that’s a bit fun to drive, you may be better off with a Ford Mondeo.

Though there are plenty of engines available on the Superb, the plug-in hybrid options in the Superb iV models are definitely worth considering by company car drivers. While you may not be able to match the claimed fuel economy of up to 217mpg (especially if you do lots of motorway driving), the car’s low CO2 emissions means the Superb iV has a BiK rate of 10% – for reference, the next best Skoda Superb has a much higher rate of 28%.


Volvo XC40 T5 Recharge

Not every eco-friendly company car has to be a big saloon – as the plug-in hybrid versions of the Volvo XC40 show, you also have options if you’d prefer a stylish SUV. The Volvo is comfortable and relaxing to drive over long distances and, unlike some other plug-in hybrid cars, the boot space hasn’t been compromised by the need to package a big battery pack.

Volvo offers the XC40 in two flavours of plug-in hybrid: a T4 Recharge with 211hp and a T5 Recharge with 261hp. Of the two, the T5 is the one to go for, as it’s just as economical on paper and has the same electric-only range of up to 28 miles. Because the two plug-in XC40s have pretty much identical CO2 emissions, they also have the same low BiK rates of 12% for the 2020/2021 tax year.


Kia e-Niro

Another electric car that’s worth shortlisting while you’re shopping around for your next company car is the Kia e-Niro. While it is quite a bit pricier than the hybrid versions of the Kia Niro, the e-Niro is fairly decent value by electric car standards, thanks to its good equipment levels, the spacious boot and (if you pick an e-Niro that’s fitted with the bigger battery) a very impressive range of up to 282 miles

Just like the previously mentioned Tesla Model 3, as the Kia e-Niro doesn’t have any tailpipe emissions, you won’t have to pay a penny in company car tax during the 2020/2021 tax year. While there will be some tax to pay during 2021/2022, the 1% BiK rate means you’ll pay far less with an e-Niro than you would if you opted for a hybrid or plug-in hybrid version of the regular Kia Niro.


Range Rover Evoque (P300e PHEV)

There are many plug-in hybrid Land Rovers on sale right now, from the off-road-focused Defender to the plush Range Rover. Of the batch of plug-in Land Rovers, it’s the Range Rover Evoque P300e that should be on your radar if you’re thinking of having a 4×4 as your next company car.

For the most part, the plug-in hybrid Evoque has all the pros and cons of the regular car. This means the P300e is relaxing to drive and has a high-quality interior, although like all plug-in hybrids, you will need regular access to a charger to get the benefit of the hybrid set up.

Of course, the real draw of the P300e is the fact it has by far the lowest company car tax rates of any Evoque on sale right now. Whereas every other Range Rover Evoque model is hit by a lofty BiK rate of 37%, the P300e version will set company car drivers back 6% to 10% for the 2020/2021 tax year, depending on the spec of the car.


Mercedes A-Class A250 e

Prefer something a bit smaller to a saloon or SUV? Enter the plug-in hybrid version of the Mercedes A-Class, which is one of a growing number of premium hatchbacks that’s available with petrol-electric power.

While the Mercedes A250 e is a pretty pricey car (mainly because it’s only available in the range-topping AMG Line trims), that expense does at least get you a well-equipped interior that’s a nice place to spend time in while you’re driving to and from work. Thanks to the car’s low CO2 emissions and quoted electric-only range of up to 45 miles, it also has a very low BiK rate for the 2020/2021 tax year – whereas petrol and diesel-powered A-Classes hover between 29% and 34%, depending on what the engine under the bonnet is, the A250e’s BiK rate is considerably lower at just 6%.


Toyota Corolla

Toyota has long been a proponent of petrol-electric power, so it perhaps isn’t a shock the hybrid Corolla is worth having a look at if you’re after an eco-friendly company car. It’s especially worth considering if you’re after a relaxing drive.

Because the Corolla is a conventional hybrid rather than a plug-in hybrid, it should also be a bit easier to match the Toyota’s claimed fuel economy of up to 62mpg in day-to-day driving – though this also means it doesn’t have the ultra-low on-paper CO2 emissions and BiK rates as similarly-sized plug-in hybrid hatchbacks like the Mercedes A250e. However, thanks to its 23% to 27% rates for the 2020/2021 tax year, the Toyota Corolla should be a bit more affordable than a conventional petrol or diesel family hatch.


Audi A6 (TFSI e)

At first glance, you may think a big executive saloon like the Audi A6 would be quite expensive to have as a company car. However, that isn’t so much the case with the plug-in hybrid TFSI e model, as this version’s low CO2 emissions and pretty good electric-only range of up to 34 miles means it has an impressively low 10% BiK rate for the 2020/2021 tax year.

Being an Audi A6, it’s also a mightily comfy car to commute in, and the interior is also as good as you’d expect from an Audi at this price. As with many plug-in hybrid cars, though, the TFSI e version carries quite a premium over a regular Audi A6. It’s also worth pointing out that, while a decent amount of kit comes as standard, there are some very expensive options available for the A6 – as BiK rates are calculated as a percentage of the car’s value, you could end up paying more than you need in company car tax if you go a bit overboard with the options and accessories lists.