What are PHEVs ?
Plugin hybids can run on internal combustion of fuel or electricity from an external source or a combination of both . The plug is the main method at the moment but maybe one day the term will be outdated if swappable batteries and inductive charging become popular. ( Don't confuse Plug-in hybrids with plain hybrids that need petrol, diesel or lpg to get going and then store some energy as electricity to use to help power some features of the vehicle.) They are disadvantaged by the weight of two separate powertrains, as well as losing out on some luggage space, but HMRC has granted useful tax advantages compared to a petrol or diesel car.
How company car tax works on Euro 6d and prior
The tax on PHEVs depends on the P11d, the battery range and the CO2 emissions according to the table below:
| Tax year | 2025/26 | 2026/27 | 2027/28 | 2028/29 | 2029/30 | |
| CO2 | Electric Range | A and F | A and F | A and F | A and F | A and F |
| g/km | miles | % | % | % | % | % |
| 1 to 50 | 130.00 and above | 3 | 4 | 5 | 18 | 19 |
| 1 to 50 | 70.00 - 129.00 | 6 | 7 | 8 | 18 | 19 |
| 1 to 50 | 40.00 - 69.00 | 9 | 10 | 11 | 18 | 19 |
| 1 to 50 | 30.00 - 39.00 | 13 | 14 | 15 | 18 | 19 |
| 1 to 50 | 0.00 - 29.99 | 15 | 16 | 17 | 18 | 19 |
| 51 to 54 | na | 16 | 17 | 18 | 19 | 20 |
| graduated | ||||||
| above 159 | na | 37 | 37 | 37 | 38 | 39 |
A good battery range allows for low rates of tax provided that CO2 emissions are below the crucial level of 51 per the WLTP test. Most PHEVs could achieve this before Europe started to use the Euro 6e-bis standard (or EU6 EB if you are looking at Volkswagen specifications) in 2025. Now we are starting to see a rush of new PHEVs emerging with much higher emission figures because they have been tested under the new standard, and this is tipping many of them over the 50g threshold. A car with a 70 mile battery range that had a taxable benefit of 6% of its list price might treble to 18% if the new CO2 is 70g.
Euro 6e-bis easement
The November 2025 Budget gives details of a temporary easement to mitigate the increasing benefit in kind tax liabilities of PHEV company cars due to new emission standards. The easement will apply retrospectively from 1 January 2025 to 5 April 2028, and up to 5 April 2031 for cars registered before April 2028. "Legislation will be introduced in Finance Bill 2025-26 to make the following changes.
Section 138A will be inserted into Chapter 6 and provides for the vehicles CO2 emission figure to be deemed a nominal value of 1 where it meets conditions set out in 138A(1). The conditions that a vehicle must satisfy to be eligible for the easement are, the:
- vehicle was first registered on or after 1 January 2025
- vehicle’s CO2 emissions figure is 51 or more
- vehicle was registered under any emission standard other than Euro 6d-ISC-FCM or Euro 6e
- car’s electric range figure is 1 or more "
Meanwhile we will get the figures updated on Comcar by 9th December so you can see the forecast tax impact and make comparisons.
Payroll alert
To take advantage of the easement, any driver taking delivery of a Euro 6e-bis PHEV with CO2 emissions above 50g/km should check that the actual figure is ignored, and instead enter the CO2 figure as 1 on the P46(car) or whatever method is used to inform HMRC of the benefit in kind value. Look at the V5C to see which euro standard has been used. It does not matter if the C02 emissions figure is below 51, but will make a big difference if it is over.
Salary sacrifice
PHEVs will still work well under salary sacrifice schemes, though make sure you get an impact on net pay illustration that takes account of the higher BIK levels from April 2028. Otherwise you can run the figures through our Salsac Illustrator. The Beta version is https://comcar.co.uk/taxtools/salarysacrifice-temporary/
April 2028
Note the large change in appropriate percentages to be applied from April 2028.
- Battery range becomes irrelevant .
- Percentages jump to a minimum of 18% but this should not kill off PHEVs if drivers are not ready to go fully electric, and the alternative is a petrol or diesel on percentages rising to 38%.
Sources
Details of HMRC's planned change are here https://www.gov.uk/government/publications/benefits-in-kind-easement-for-plug-in-hybrid-electric-vehicles/plug-in-hybrid-electric-vehicles-benefits-in-kind-easement
For a listing of Euro 6e-bis select the fuel type required on this page https://comcar.co.uk/electric/hybrids/ The nominal values for the easement will be added soon so that the calculators work correctly for Euro 6e-bis cars over 50gm/km.
