The paper starts with a review of constitutive equations for rubber‐like materials, formulated in the invariants of the right Cauchy—Green deformation tensor. A general framework for the derivation of the stress tensor and the tangent moduli for invariant‐based models, for both the reference and the current configuration, is presented. The free energy of incompressible rubber‐like materials is extended to a compressible formulation by adding the volumetric part of the free energy. In order to overcome numerical problems encountered with displacement‐based finite element formulations for nearly incompressible materials, three‐dimensional finite elements, based on a penalty‐type formulation, are proposed. They are characterized by applying reduced integration to the volumetric parts of the tangent stiffness matrix and the pressure‐related parts of the internal force vector only. Moreover, hybrid finite elements are proposed. They are based on a three‐field variational principle, characterized by treating the displacements, the dilatation and the hydrostatic pressure as independent variables. Subsequently, this formulation is reduced to a generalized displacement formulation. In the numerical study these formulations are evaluated. The results obtained are compared with numerical results available in the literature. In addition, the proposed formulations are applied to 3D finite element analysis of an automobile tyre. The computed results are compared with experimental data.