Tax Incentives with an Electric Fleet for Companies!

Are you looking to maximise profits and minimise your tax responsibilities? An electric fleet will offer all of the above! As well, you get the ability to reduce your carbon footprint and boost your green credentials. There is a wide initiative to get UK businesses on board with its net-zero mission. The UK Government offers some pretty impressive tax incentives to tempt businesses to switch their fossil fuel-guzzling fleets to cleaner, greener business cars. There’s never been a better time to introduce electric company cars to your business! What are the tax incentives with an electric fleet?

Vehicle Excise Duty

Fully electric cars are completely exempt from vehicle excise duty. If that’s not enough, any low emission or plug-in hybrid company car that emits less than 75/km CO2 will also pay less road tax in the first year. Also, electric power is not road fuel. Therefore, ultra-low emission cars are also exempt from the fuel benefit charge!

Benefit in Kind

Even better news is still to come! Fully electric vehicles are completely exempt from company car tax from April 2020 onwards. Benefit in Kind rates only increasing to 1% from April 2021 and 2% in April 2022! This is nothing compared to the eye-watering 37% charged on the least CO2 efficient vehicles on our roads! This is a tempting tax perk that no business should ignore. Greener cars also accrue fewer employer’s Class 1 National Insurance contributions as these are linked to a car’s CO2 emissions and purchase value.

Congestion Charges

Congestion charges may well be on the cards for all major cities to reduce pollution and improve urban air quality, so it isn’t just businesses that need to use the roads in and around the capital that could be feeling the brunt of these additional congestion charge costs. For those looking to go electric with their fleet, congestion charges have been completely removed for ultra-low emission vehicles, so you’ll pay absolutely nothing if you make the switch to full electric fleets.

Sounds good, doesn’t it? If you want to find out how much you stand to save with an electric fleet of company cars, head over to our quote calculator to get a better idea of just how cost-effective going electric could be for your business.