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Interest-Free Employer Loan BIK Tax 2025-26
If your employer lends you money at 0% (or below HMRC's official rate of 2.25%), it's a taxable benefit in kind. The BIK value is the interest you would have paid at the official rate.
Beneficial loan BIK — 2025-26 rules De minimis exemption
£10,000
BIK value formula
Loan × 2.25%
Reported via
P11D or payroll
Loans of £10,000 or less across all employer loans are completely exempt — the BIK only triggers above this threshold. Qualifying loans (e.g. season ticket loans) below £10,000 are always tax-free.
£10,000 interest-free loan — BIK tax by salary
BIK value: £225/year (£10,000 × 2.25%)
Salary BIK value Tax on loan NI on loan Annual cost Monthly cost £25,000 £225 £45 £18 £63 £5 £30,000 £225 £45 £18 £63 £5 £40,000 £225 £45 £18 £63 £5 £50,000 £225 £45 £18 £63 £5 £60,000 £225 £90 £4 £94 £8 £75,000 £225 £90 £4 £94 £8 £100,000 £225 £135 £4 £139 £12
£15,000 interest-free loan — BIK tax by salary
BIK value: £338/year (£15,000 × 2.25%)
Salary BIK value Tax on loan NI on loan Annual cost Monthly cost £25,000 £338 £68 £27 £95 £8 £30,000 £338 £68 £27 £95 £8 £40,000 £338 £68 £27 £95 £8 £50,000 £338 £81 £23 £104 £9 £60,000 £338 £135 £6 £141 £12 £75,000 £338 £135 £6 £141 £12 £100,000 £338 £203 £6 £209 £17
£20,000 interest-free loan — BIK tax by salary
BIK value: £450/year (£20,000 × 2.25%)
Salary BIK value Tax on loan NI on loan Annual cost Monthly cost £25,000 £450 £90 £36 £126 £11 £30,000 £450 £90 £36 £126 £11 £40,000 £450 £90 £36 £126 £11 £50,000 £450 £126 £26 £152 £13 £60,000 £450 £180 £9 £189 £16 £75,000 £450 £180 £9 £189 £16 £100,000 £450 £270 £9 £279 £23
£25,000 interest-free loan — BIK tax by salary
BIK value: £563/year (£25,000 × 2.25%)
Salary BIK value Tax on loan NI on loan Annual cost Monthly cost £25,000 £563 £113 £45 £158 £13 £30,000 £563 £113 £45 £158 £13 £40,000 £563 £113 £45 £158 £13 £50,000 £563 £171 £28 £199 £17 £60,000 £563 £225 £11 £236 £20 £75,000 £563 £225 £11 £236 £20 £100,000 £563 £338 £11 £349 £29
£30,000 interest-free loan — BIK tax by salary
BIK value: £675/year (£30,000 × 2.25%)
Salary BIK value Tax on loan NI on loan Annual cost Monthly cost £25,000 £675 £135 £54 £189 £16 £30,000 £675 £135 £54 £189 £16 £40,000 £675 £135 £54 £189 £16 £50,000 £675 £216 £30 £246 £21 £60,000 £675 £270 £13 £283 £24 £75,000 £675 £270 £13 £283 £24 £100,000 £675 £405 £13 £418 £35
£40,000 interest-free loan — BIK tax by salary
BIK value: £900/year (£40,000 × 2.25%)
Salary BIK value Tax on loan NI on loan Annual cost Monthly cost £25,000 £900 £180 £72 £252 £21 £30,000 £900 £180 £72 £252 £21 £40,000 £900 £180 £72 £252 £21 £50,000 £900 £306 £35 £341 £28 £60,000 £900 £360 £18 £378 £32 £75,000 £900 £360 £18 £378 £32 £100,000 £900 £540 £18 £558 £47
£50,000 interest-free loan — BIK tax by salary
BIK value: £1,125/year (£50,000 × 2.25%)
Salary BIK value Tax on loan NI on loan Annual cost Monthly cost £25,000 £1,125 £225 £90 £315 £26 £30,000 £1,125 £225 £90 £315 £26 £40,000 £1,125 £225 £90 £315 £26 £50,000 £1,125 £396 £39 £435 £36 £60,000 £1,125 £450 £22 £472 £39 £75,000 £1,125 £450 £22 £472 £39 £100,000 £1,125 £675 £22 £697 £58