The Business Bulletin
The low down on tax and electric vehicles Business parks and hotel car parks are beginning to fill up with electric vehicles and, at the time of writing, the RAC estimates that there are more than 330,000 zero-emission Battery Electric Vehicles on the UK’s roads – with more than 125,000 registered in 2021 alone – along with 320,000 plug-in hybrids and over 700,000 conventional hybrids.
By 2030 new fossil fuel cars will cease
A maximum grant of up to £2,500
2022 and a claim submitted to the
to be sold in the UK. Before then, the
is available for an eligible new car, and
Driver and Vehicle Licensing Agency by
Treasury is incentivising business
further grants are available for eligible
30 April 2022.
drivers to go electric by offering some
motorcycles, mopeds, small vans,
key tax benefits:
large vans, taxis and trucks.
For a pure electric car, a low benefit
The Electric Vehicle
in kind rate
Homecharge Scheme
The scheme will remain open to: ■ homeowners who live in flats ■ people in rental accommodation (flats and
For the current 2021/22 tax year this is
This is a grant that provides a 75%
set at 1% rising to 2% for the 2022/23 tax
contribution to the cost of one
year. E.g. in 2021/22 the benefit in kind
charge-point and its installation. A
for an electric Tesla with a list price of
grant cap is set at £350 (including
£100,000 has a benefit in kind charge
VAT) per installation. The main
of £1,000 whereas a high emission
requirement is that a person owns,
fossil fuelled car with the same list
leases, or has ordered a qualifying
price of £100,000 has a benefit in kind
vehicle and has dedicated off-street
charge of £37,000. For a 40% tax-payer
parking at their property. A person
the tax saved by going pure electric is
may apply for 2 charge-points at
normally it comes down to cash flow.
£14,400 in this example.
the same property if they have 2
1. Buying – this can be by cash or
qualifying vehicles. For a low emission car, a plug-in
single-use properties)
Should you buy or lease your electric vehicle? A common big question is whether to buy or lease your new electric vehicle. There are advantages and disadvantages of either way but
by finance. Having full ownership
grant for qualifying vehicles
From April 2022, the Electric
of the vehicle means you may be
Vehicle Homecharge Scheme will
able to claim a capital allowance
You can get a discount on the price
no longer be open to homeowners
against the purchase, for a new
of brand new low-emission vehicles
(including people with mortgages)
vehicle this could be a 100%
through a grant the government
who live in single-unit properties
annual investment allowance.
gives to vehicle dealerships and
such as bungalows and detached,
The disadvantage to buying is
manufacturers. The grant is
semi-detached or terraced housing.
that you often have to find cash
automatically deducted from the price
Installations in single-unit properties
or have the ability to obtain
of the car at source by the dealer.
need to be completed by 31 March
finance.
12 | Issue 17 – Finance
