Choosing a company car is an exciting prospect when starting a new job, and while increased taxation has reduced the number of employees seeking a vehicle as part of their remuneration package, selecting wisely can still provide an excellent perk and save you money.
Recent times have brought significant changes to the company car system. Certain cars - including petrol and diesel models - are now expensive to tax, while even electric cars have seen significant cost rises in the past few years.
Even so, the most effective way to minimise Benefit-in-Kind (BIK), the tax applied to company cars, is to opt for an EV. Business users are taxed on 3% of the car's value, potentially saving them thousands of pounds in annual tax.
However, despite significant advancements in EVs and their charging infrastructure, they may not be suitable for all drivers, particularly those who cover long distances on tight schedules.
For many employees, traditional internal combustion-engined (ICE) and hybrid models remain more practical. That's why our top 10 list below focuses on both EVs and plug-in hybrid options.
These choices span various categories, from small cars to SUVs, aiming to offer something for everyone. Each vehicle combines low BIK bills with sufficient driver appeal to maintain interest.
Our top pick for the best company car is the Volkswagen ID 7. Want to know why? Read on…
Best for EV drivers
BiK rate 3%
Monthly BiK tax at 20% £25.75
Monthly BiK tax at 40% £51
We believe the Volkswagen ID 7 is the best company car in 2025, and that's not just because of its ultra-low 3% benefit-in-kind banding.
The ID 7 is a brilliant all-rounder offering a pleasant, spacious interior, excellent ride quality and surprisingly capable handling, making this EV a great choice for longer commutes.
Battery sizes range from 77kWh to 86kWh, which means a range as high as 440 miles. The larger 86kWh battery also offers charging speeds of up to 200kW, so those quick homeward-bound top-ups won't take forever. Even the smaller-battery cars can charge at up to speeds of 175kW.
There’s also a choice of saloon and Tourer (estate) bodystyles, both with class-leading practicality. The standard saloon boasts a 532-litre boot, while the Tourer offers an even more cavernous 605 litres.
Read our Volkswagen ID 7 review
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