The most popular company cars used to be a work perk. Now, they’re a way to make your business run smarter. From the most reliable car brands to the newly established cost effective manufacturers, we have got you covered.
Pick the right model and you could save a chunk in tax, cut running costs, and even boost your green credentials. The only tricky bit? Knowing what’s actually worth the money.
Whether you’re managing a growing fleet or just looking at options, this guide breaks down what’s popular right now — and how some of the latest tax perks could give you a real edge.
From electric vehicles that keep your Benefit-in-Kind low, to hybrids that balance performance with pennies, we’ve rounded up the trends that matter. And if you’re still not sure what route to take, we’ll also cover how to figure out what’s right for your business.
Thinking about upgrading or dipping your toe into the company car pool? Let’s look at what’s hot — and what’s clever — in 2025.
What Are the Most Popular Company Cars in the UK Right Now?
Electric is still gaining ground — and for good reason. EVs and low-emission hybrids are dominating the company car scene thanks to their tax perks, lower running costs, and growing driver appeal.
Based on recent data and fleet trends, these models are consistently top picks for UK fleets right now:
🚗 Tesla Model 3
Still a clear favourite. It’s sleek, fully electric, and comes with one of the lowest Benefit-in-Kind (BIK) tax rates around. Smart on the road, smart on your tax bill.
🚗 BMW 3 Series
A bit of a classic in the company car world. Smooth, reliable, and available in petrol, diesel, or plug-in hybrid — so you have options.
🚗 Volkswagen ID.4
A strong electric SUV contender — great for longer commutes and teams needing more space. Plus, it’s eligible for the government’s EV grants and has zero-emission tax perks.
🚗 Kia EV6 & Hyundai Ioniq 5
Two rising stars in the EV space. Future-friendly looks, solid mileage, and increasingly popular for businesses going greener without compromising on style.
🚗 Vauxhall Corsa and Peugeot 208
Compact but mighty. These models (especially the electric versions) are spot-on for short trips, city routes, or zipping between meetings.
Looking to revitalise your fleet? Head to our Fleet Finance page to see how we can help you fund your next batch of company cars.
Why Are Electric & Hybrid Company Cars So Popular?
In two words? Tax savings. But that’s not the only reason electric and hybrid cars are climbing the ranks of the most popular company cars.
Here’s what’s driving the shift:
- Benefit-in-Kind (BIK) tax rates for fully electric vehicles are currently just 2% (2024/25), compared to 20–37% for petrol or diesel.
- National Insurance savings for employers — lower BIK = lower Class 1A NICs.
- No fuel benefit charge on EVs (because, well, no fuel).
- UK government incentives for electric cars are still available for installing workplace chargers, or support when transitioning a fleet.
Even plug-in hybrids come with perks. The lower your CO₂ emissions and the further you can go on electric alone, the better your tax band.
So, if you’re offering company cars, or even just car allowances, this stuff matters. And if you’re shopping around, you might want to look into the best business car lease deals to make things even more cost-efficient.
What About Capital Allowances?
Buying a low-emission car outright? There’s another bonus you might not know about.
You could claim 100% first-year capital allowances, meaning you can knock the full cost off your pre-tax profits. Great news if you’re watching the bottom line.
This applies to:
- Brand new, fully electric vehicles
- Some hybrids with lower CO2
- Charging infrastructure (in some cases)
Basically, if you’re investing in clean transport, HMRC’s letting you off the hook (for now). Just make sure your accountant checks the latest rules. They can shift without much warning.
Curious about smarter finance options? Browse some of our latest case studies to see how other UK businesses are managing fleet costs.
How to Choose the Right Company Car
Picking a company car isn’t just about what looks good on the driveway. It needs to work for your team, your tax bill, and your budget.
Here’s what to weigh up:
✅ Tax efficiency – Look at company car tax 2025 bands. Can you cut costs with a greener model?
✅ Mileage & range – Need something that can take long motorway trips, or mostly do short city hops?
✅ Cost to run – EVs save on fuel, but some cost more upfront. Insurance and maintenance vary between the most reliable car brands.
✅ Charging – Do you have easy access to workplace or public chargers?
✅ Lease vs Buy – The best business car leases can give you flexibility, especially when upgrading to EVs. Business contract hire or asset finance can make costs more manageable.
And if you’re still weighing it all up, have a quick word with our Sorbus team. They’ll walk you through your options, no pressure.
The Takeaway
Company cars are evolving — and fast.
With the UK government still pushing the zero-emissions agenda and BIK incentives staying low for EVs, the direction’s pretty clear: if you want to save money and do your bit for the planet, electric is the future (and it’s tax-friendly, too).
Looking to refresh your fleet or try something new? The right company car can help cut costs and boost your green credentials.
Need a hand comparing company car finance options? Talk to Sorbus.
We’ll help you work out whether leasing, buying or chasing that EV subsidy UK makes most sense for you.