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UK Recruitment Glossary

BIK (Benefit in Kind)

Alex By Alex · 12-year UK recruiter · Updated April 2026

In recruiter context

Common UK benefits and approximate tax cost: private medical insurance (taxed at full premium value, often £1,000-£3,000/year added to taxable income), company car (taxed based on CO2 and list price, often £4,000-£15,000/year added), beneficial loans over £10,000 (taxed at HMRC official rate of interest). Some BIKs are tax-exempt: pension contributions, childcare vouchers (closed scheme), bicycles via cycle-to-work. Salary sacrifice for BIK saves both income tax and NI. Worth doing the maths: a £1,500/year private medical premium costs roughly £600 in tax for a higher-rate taxpayer.

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