The scheme will be available for all high-mileage employees, saving an estimated 4 tonnes of carbon per car, per year*!
The Prime Minister’s announcement to ban petrol and diesel cars by 2035, reinforced by the Chancellor’s commitment to spend £500m to support the rollout of rapid EV charging, sends a clear message that the adoption of EVs is no longer just a ‘nice to have’ but a ‘must ‘ to reach decarbonisation goals. Research also suggests that investment in electric vehicles by UK businesses is set to increase by almost 50% over the next two years, exceeding £12 billion.
It isn’t just the progression in technology and infrastructure which drove us to consider a fully electric fleet. There are significant taxable benefits which we outline below:
From 6 April 2020 until 5 April 2021, full battery electric vehicles (BEVs) will pay no Benefit in Kind rate. This compares to 37% at the opposite end of the emissions scale.
This 0% rate also applies to company car drivers in pure electric vehicles registered prior to April 6, 2020. Additionally, the 0% rate will also apply to company cars registered after April 6, 2020, with emissions from 1-50g/km and which have an electric mile range of 130 miles or more. Both will increase to 1% in 2021/22 and 2% in 2022/23.
For companies planning to purchase rather than lease their fleet there is also the added benefit of a 100% first-year allowance (FYA) which is currently in place for the 2019/20 tax year. This effectively gives full tax relief to companies on the cost of the car in the year of its purchase.
This means that a £35,000 investment in an electric vehicle would yield a £7,000 saving in tax relief for your company.
There are also other benefits of ‘going green’ (including reduced road tax, being exempt from the Ultra-Low Emission Zone (ULEZ) and congestion charges and a Plug-in Grant of up to £3,500), so it is not hard to see why companies are beginning to look at electric car as a viable option for their fleet.
At Capitas, we’ve developed a range of tailored financial solutions and services designed to support private and public sector organisations considering Electric Vehicles and EV charging infrastructure.
Please contact us to find out more.
*Based on an estimated 15k miles per year, at an estimated 40mpg.