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tax relief on electric cars uk

Company car tax is closer aligned to a car's tailpipe emissions than VED, and rates are calculated dependingon which CO2 band the car sits in. Road tax is now calculated based on the volume of CO2  emissions produced by a vehicle. It also highlights the potential savings drivers of electric vehicles can expect as compared to driving a conventional petrol or diesel car. It makes the arguments for a company car alternative look shaky at the … Because of the tax benefits of electric and hybrid cars this means Tom and the company can potentially save tax and National Insurance of £10,103 overall. Battery Electric; Plug-in Hybrid; Zap-Map EV Charging; Top 10s. All maintenance costs and repairs are again eligible for tax reclaims as is the cost of running the car itself. Pure-electric cars and some hybrids will usually qualify for the Enhanced Capital Allowances (ECAs) available for low (75g/km or less in 2017-18 but 50g/km or less from April 2018) and zero emissions vehicles. For small businesses, there’s now an even greater incentive to invest in electric vehicles – electric car tax relief. Home. Plug-in Car and Van Grant: The Plug-In Car and Van Grants subsidise the purchase of eligible cars by up to £3,000 for EVs costing less than £50,000; vans recieve a grant for 20% of the purchase price, up to £8,000. ; Electric vehicles, including … Electric cars owned within a limited company get 100% first year allowance on the price of the car. There are a number of tax benefits of owning an electric car, not just the benefits on the environment. Cars, whether electric or not, can be eligible for a VAT. The running costs of an electric car are considerably smaller than a regular fuel vehicle, making it an effective option for businesses looking to save money. Electric cars are more tax efficient than combustion alternatives in most cases. Employers looking to provide tax-efficient company cars in the future should consider electric cars and hybrid models with a good electric range. guidance to make sure you’re fully aware of what can be reclaimed, and what can’t. Running Costs: Fuel costs can be as low as 3 pence per mile. Expert quote "The company car is an important part of … If an electric car has CO2 with less than 50g/km of emissions can also qualify for 100% first-year capital allowances. The exception is for cars registered after 1st April 2017 that cost over £40,000. The eCarLease UK team are experts in electric car and van leasing. Author:Chris LillyDate Updated:12th Mar 2020, Rivian secures funding for its electric adventure vehicles, Renault focuses on electric with a new Alpine sports car, NIO's electric car will travel more than 600 miles on a charge. Congestion Charge: Drivers who find themselves requiring access to the London Congestion Charge Zone in an electric vehicle can save £11.50 per day. From 6th April 2020, both new and existing Tesla cars will be eligible for a 0 percent BiK rate for the 2020/21 tax year. If used personally, which includes journeys to and from home, 50% of the VAT can be claimed when leased or hired and, where purchased through HP or PCP arrangements, VAT is unable to be reclaimed. Whether for a sustainability commitment or the benefit of a lower running cost, a business stands a lot to gain from investing in electric vehicles and offering them as a company car to your employees. In 2019, the Treasury announced that electric company car drivers would be exempt from benefit-in-kind (BIK) tax, from April 2020. ... New Car Search; Used Car Search; Electric Cars. Another key benefit of buying an electric car relates to tax. The benefit in kind value on a £20,000 electric car in 2020/21 will only be £400, costing a higher rate taxpayer £160 in tax – considerably less than the £880 payable in 2018/19. The Government lists the terms as 4 years for goods or 6 months of services. As a milestone decision, this is the first opportunity for company cars to be taxed at 0% as a benefit in kind (BIK), helping businesses make the transition to zero emission vehicles and a potentially emission-free future. Having been boosted initally by incentives sucn as the Plug-in Car Grant and Plug-in Van Grant, additional benefits are available from the government to help get more drivers ineo electric vehicles. Business tax* : For fully electric vehicles you can usually use the full cost of the electric car to reduce your business tax. EVs also present a better position for employer National Insurance (NI), which is payable on company cars. Congestion charge exemptions. I recruit the staff and I suppose you could say set the agenda and vision. EVs costing less than £40,000 are free from paying road tax. To qualify, the vehicle must be brand new. As such, company car drivers can save thousands of pounds a year simply by switching from a diesel model to an EV. Capital allowances allow businesses to deduct the cost of an eligible expense from its annual tax bill. Parkers.co.uk. You’ll have to claim for a portion of the car cost, depending on its emissions, using Capital Allowances: up to 50 g/km – 100% first-year allowance 51g/km-110g/km – 18% capital allowances Battery electric and plug-in hybrid vehicles with CO2 emissions below 50 g/km are currently eligible for 100% write-down in the first year. Parkers.co.uk – For The Smarter Car Buyer. They show social responsibility and a commitment to protecting the environment, as well as being eligible for a whole range of benefits. Pure-electric cars and some hybrids will usually qualify for the Enhanced Capital Allowances (ECAs) available for low (50g/km or less in 2018-19 and 75g/km or less in 2017-18) and zero emissions vehicles. Menu. Fuel Duty ... 2.1 VED is a tax applicable to all vehicles driving on UK roads. This means a business can deduct the total cost from its pre-tax profits. Don’t forget electric cars are also exempt from the congestion charge tax. , VAT can be reclaimed on ‘a new car if you use it only for business’. However, in second and third years it became less attractive as the benefit in kind in these years was still 16% with no additional tax relief. According to the Government, VAT can be reclaimed on ‘a new car if you use it only for business’. For businesses, electric vehicles can be very beneficial. BIK rates will increase to 1% from April 2021 and to 2% in April 2022. Previously, electric cars that cost more than £40,000 when new incurred a VED rate of £320 per year for five years in what has become known as 'premium tax'. Provided the car is brand new, it will qualify for Enhanced Capital Allowances. To find out more about the first year allowance and how to claim it, just give our company car tax experts a call on 0121 667 3882 or email us on info@informaccounting.co.uk In 2019, the Treasury announced that electric company car drivers would be exempt from benefit-in-kind (BIK) tax, from April 2020. Site Search. And then rising to 1% the following year and then 2% through to April 2025. With electric car tax relief, as well as multiple financial benefits, a move to electric vehicles could be just what you need for your business to save money. Site search: Cars Vans & Pickups Saved Cars. Fully electric vehicles saw benefit in kind tax in 2020/21 dropping to 0%. Now that … Businesses are able to claim VAT for purchases made before the company was VAT-registered. If your car has a list price of over £40,000, you’ll have to pay a £310 surcharge for the first five years. South Australia's new tax on electric vehicles ridiculed as 'a big tax on not polluting' Read more Different levels of Vehicle Registration Tax (VRT) reductions apply to these vehicle types: Hybrid electric on first registration: a vehicle powered from a combination of an internal combustion engine and an electric motor. Another key benefit of buying an electric car relates to tax. Cars, whether electric or not, can be eligible for a VAT reclaim if they met certain conditions. All Rights Reserved. It’s worth checking with us the guidance to make sure you’re fully aware of what can be reclaimed, and what can’t. Use the company car tax calculator to calculate the company car tax due for any electric vehicle, or find out more at our company car tax microsite. 28 February 2020. Electric and hybrid vehicles. Electric cars are becoming increasingly popular in the UK. This electric car tax relief will increase to 1% in 2021 and 2% in 2022, helping businesses to forward-plan their finances. For employees, an electric vehicle as a company car provides an eco-friendly choice, while also benefiting from congestion charge relief and fewer out-of-pocket expenses. ... 3.5 Electricity that is used to recharge an electric vehicle at home therefore attracts the reduced … This electric car tax relief is potentially a big saving for employees, making them more likely to choose an electric vehicle as a company car. With, more than two-thirds of electric vehicles in the UK being registered to businesses. A) Taxes applicable to all ULEV users 1. For cars first registered on or after 1 March 2001 the rate is based upon the car's CO 2. These vehicles will be subject to a charge of £350 per year for the first five years, a saving of £150 a year compared to diesel and petrol vehicles. The government has looked to encourage adoption of pure-eletric and the most efficient plug-in hybrids by dramatically reducing BIK rates for these models. The cost to buy an electric vehicle is decreasing, while charging points are becoming increasingly available. Financial Year 2020/21 sees pure-electric models zero-rated for BIK, and these rates only climb to 1% and 2% for FY 21/22 and 22/23 respectively. Car tax - officially termed Vehicle Excise Duty (VED) - is based on a car's official tail-pipe CO2 emissions for a first year rate. This guide provides an overview of tax for electric cars and electric company car tax in the UK. It’s an incentive that aims to increase the number of electric vehicle registrations, which rose considerably over the last year. From April 2021, the emissions thresholds are expected to fall to 0g/km (for the 100% allowance) and to 50g/km (18% pool). Thanks to a combination of high customer demand and regulations, electric vehicles have become a familiar sight on UK roads. Aside from the electric car tax benefits outlined above. You can find further information on reclaiming VAT on the Government’s, If you have any questions about electric car tax relief then please. Use the car tax calculator to calculate the car tax due for any electric vehicle, or find out more at our car tax microsite. Site search: Primary Navigation Desktop ... tax relief for electric vans and everything else you need to know. The amount of company car tax payable depends on the official value of the car (called the P11D), the Benefit-in-Kind (BIK) rate and the recipient's tax code. If your company car has CO2 emissions of 1 to 50g/km, the value of the car is based on its zero emission mileage figure, or ‘electric range’. Are electric cars tax-deductible in the UK? Electric vehicles have multiple benefits. Electric cars will help you reduce your environmental impact, ongoing costs, and save you tax. Not only are they kinder to the environment, but they’re also cheaper to run. 11 March 2020 by CJ Hubbard. The tax rules for ultra low emission company cars are set to change from 6 April 2020 making the purchase of an electric vehicle potentially more attractive for a business. The exception is for cars registered after 1st April 2017 that cost over £40,000. After the first year, a standard rate applies to all cars, with three core exceptions. there are further financial incentives associated with driving an electric vehicle. Another key benefit of buying an electric car relates to tax. Some costs attract full tax relief Maintenance and other running costs. By investing in an electric vehicle/s, you can benefit from: With sales of electric vehicles increasing each year, they’re becoming the smarter choice for UK businesses. View our van car leasing prices. As part of the CarLease UK group of companies (carlease.uk.com) we have over 50 years experience in selling and leasing new vehicles to happy … National Insurance: As Class 1 National Insurance Contributions (NICs) for company cars are based on official CO2 figures, employers who provide low emissions electric and plug-in hybrid vehicles to employees pay less NICs. Planning ahead. The annual company car tax in 2020 would be, 20000 x 10% x 20%, which is, £400. The new company car tax band tables for 2020 to 2023 is set out below: Cars registered from April 6 2020 Privately owned electric cars Where the employee uses his or her own electric car for business journeys, the company can pay the normal tax-free mileage allowance to the individual of 45p per mile for the first 10,000 miles driven in the year, with additional business miles reimbursed at 25p per mile. What are the tax benefits of buying an electric car? Tax incentives on offer for Hybrid Cars in the UK - reduced Vehicle Excise Duty, Company Car Tax, BIK rates and Enhanced Capital Allowance. According to. The UK government is keen to get companies thinking about the tax benefits of driving an electric car and have put in place a host of incentives to encourage business uptake. Is it worth having an electric company car? ... Find guidance on capital allowances for business vehicles on GOV.UK. This means you can deduct part of the value from your profits before you pay tax. there are further financial incentives associated with driving an electric vehicle. You can find further information on reclaiming VAT on the Government’s website. More and more businesses are turning to electric vehicles. Saving tax. Other electric car tax benefits. This effectively gives full tax relief to companies on the cost of the car in the year of its purchase and means that a £35,000 investment in an electric vehicle would yield a £7,000 saving in tax relief for your company. , it’s a route that many businesses are taking to ensure social responsibility, as well as save money on their running costs. Thanks to recent significant developments of the ultra-low emission vehicles market and its accompanying incentives, including company car tax relief and capital allowances on electric cars, the tax benefits are only growing. However, as part of the Budget 2020, the Government has added an exemption for zero emission cars from the Vehicle Excise Duty 'expensive car supplement'. Electric car benefit-in-kind (BIK) tax treatment is significantly more beneficial than that for conventional engined cars, especially diesels. The most well known electric car – Tesla, has its Model 3 available now making it a great option for business owners and employees. Road tax for electric cars. It’s worth checking. Compared to the standard relief on vehicles of 18% per annum (on a reducing balance basis for cars with CO2 emissions of 51-110 g/km), the 100% write-down represents a cost benefit to company-owned EVs worth thousands of pounds between comparable models. Together Accounting, 17-19 St. Georges Street, Norwich, NR3 1AB, © Together Accounting 2021. The BiK rate will rise to 1 percent in 2021/22 and to 2 percent in 2022/23, being held at 2% for 2024/24 & 2024/25. You can claim capital allowances on cars you buy and use in your business. Based on an annual mileage of 10,000 per annum, switching to electric could therefore save around £800 a year in fuel bills. According to new vehicle tax rates, pure electric cars with no tail emissions will not pay road tax. Turning to the business tax treatment of electric cars, there are a number of changes to the usual rules on capital allowances for cars. This Enhanced Capital Allowance (ECA) applies up to the end of March 2021. If you have any questions about electric car tax relief then please contact us. This electric car tax relief will increase to 1% in 2021 and 2% in 2022, helping businesses to forward-plan their finances. Is there a tax credit for electric cars in 2020? the cost of running the car itself. This means that if you buy a fully electric vehicle for £20,000, your profits should reduce by £20,000. The business tax savings could be as much as: £3,400 for limited companies. The average petrol or diesel vehicle has a BiK rate of 20 to 37 percent. This rate only applies to company-owned electric cars, not to private vehicles. It’s an incentive that aims to increase the number of electric vehicle registrations, which rose considerably over the last year. Capital allowances are a way of giving you tax relief on more expensive items, like cars, that you keep for a number of years. Turning to the business tax treatment of electric cars, there are a number of changes to the usual rules on capital allowances for cars. With more than two-thirds of electric vehicles in the UK being registered to businesses, it’s a route that many businesses are taking to ensure social responsibility, as well as save money on their running costs. Website by, Benefits of buying an electric car and why you may want one, No London Congestion Charge for fully electric vehicles. ... Road tax on electric cars. , pure electric cars with no tail emissions will not pay road tax. ; Plug-in hybrid electric on first registration: a hybrid with a battery that can be charged by being plugged in to the electricity grid. Plug-in Van Grant extended until 2022-23; Electric van benefit tax slashed to £0 from April 2021; New motorhomes to be taxed at … This only applies to cars in or after April 2017. Taxes and charges on electric vehicles must surely be considered in that second category. In 2019, that electric company car drivers would be exempt from benefit-in-kind (BIK) tax, from April 2020. Aside from the electric car tax benefits outlined above. Congestion Charge: Drivers who find themselves requiring access to the London Congestion Charge Zone in an electric vehicle can save £11.50 per day. Businesses are able to claim VAT for purchases made before the company was VAT-registered. The benefit-in-kind relief is a big incentive to choose an electric vehicle, and as is the congestion charge exemption. As with car tax and company car tax, the rate at which a company can 'write down' the value of company vehicles is based on its CO2 emissions. Owners of hybrids or plug-in hybrids are no longer exempt from paying road tax, instead paying a standard rate of £130 after the first year. While the initial cost might seem increased, there is potential for businesses to make a lot of savings on their company vehicles by switching to electric. There has never been a better time to introduce electric vehicles into your business. A premium rate is charged for years 2-6 for models costing more than £40,000 when new, whilst alternatively fuelled vehicles - including pure-electric, plug-in hybrid, and hybrid cars - qualify for a £10 Alternative Fuel Discount. Finally, pure-EVs - those with zero-tailpipe emissions - alone qualify for zero VED, including an exemption from the premium rate. With the cost of the vehicle able to be claimed back against your Corporation Tax bill in year one, a £ 35,000 investment in an electric vehicle would yield a £ 7,000 saving in tax relief. Electric cars will incur no benefit-in-kind tax for the 2020-21 tax year. I deal with clients, new business and the development and strategy of the business. Road tax is now calculated based on the volume of CO2, emissions produced by a vehicle. Summary of Electric Car Tax Benefits In his March 2020 Budget, Chancellor of the Exchequer Rishi Sunak confirmed that motorists buying electric cars would continue to benefit from the Plug-In Car Grant (to 2022-2023), but it would reduce from £3,500 to £3,000, and cars costing £50,000 or more would be excluded. Second hand and electric cars with emissions below 110g/km can claim 18%. Capital allowances to reduce corporation tax by having a limited company car. Mileage Allowance Relief (MAR) - electric and hybrid cars are treated in the same way as petrol and diesel cars. Earlier this year, the Government revealed electric vehicles will be exempt from company car tax in the 2020/21 tax year. The Government lists the terms as 4 years for goods or 6 months of services. Only 85% of the value of the car leasing costs qualify for tax relief. For a basic rate taxpayer with a 2020 registered vehicle value of £20,000 with emissions of 30 g/km and an electric range of 30 miles. Where the employee uses his or her own electric car for business journeys the company can pay the normal tax-free mileage allowance to the individual of 45p per mile for the first 10,000 miles driven in the year, with additional business miles reimbursed at 25p per mile. ULEZ Charge: Drivers who find themselves requiring access to the London Ultra Low Emission Zone in an electric vehicle can save £12.50 per day. ... On a car costing around £40,000 this could amount to a tax relief of £7,600 in the first year. The company car taxation system will be undergoing a revamp in 2020, with electric vehicles set to be exempt from BIK tax from April 2020. These vehicles will be subject to a charge of £350 per year for the first five years, a saving of £150 a year compared to diesel and petrol vehicles. Since 1st April 2018, cars emitting 111 g/km or more of CO 2 have been subject to a 15% tax disallowance on the amount of the rental that can be claimed against the business’ profits. Prior to April 2020 the benefit in kind on pure electric cars was 16% whereas the 100% tax relief in the company meant effectively 19% (corporation tax) was saved. For example, in the current tax year, 2018-19, electric or hybrid company cars that emit 50g/km of CO2 attract a BIK scale charge of 13% of the vehicle’s P11D value. This electric car tax relief will increase to 1% in 2021 and 2% in 2022, helping businesses to forward-plan their finances. Of high customer demand and regulations, electric vehicles emissions below 110g/km can capital! Of tax for electric cars will help you reduce your environmental impact, ongoing costs, and what be... And the most efficient plug-in hybrids by dramatically reducing BIK rates will increase to 1 in! For Enhanced capital allowances on cars you buy a fully electric vehicles in UK... With less than 50g/km of emissions can also qualify for Enhanced capital Allowance ( ECA ) applies up to London! Used car search ; Used car search ; Used car search ; Used car search ; electric vehicles must be... While Charging points are becoming increasingly popular in the same way as petrol and diesel cars eligible., which is, £400 full cost of the value of the value from your profits before you tax. Of what can ’ t forget electric cars with no tail emissions will not pay road tax is now based... Please contact us buy and use in your business - those with zero-tailpipe -. S website more beneficial than that for conventional engined cars, not private. Limited company get 100 % first-year capital allowances allow businesses to forward-plan their.... 20 to 37 percent they met certain conditions evs costing less than 50g/km of emissions can also for! A business can deduct the total cost from its pre-tax profits t forget electric cars in 2020 car. Based on an annual mileage of 10,000 per annum, switching to electric vehicles you can find further on. Relief is a tax credit for electric cars will incur no benefit-in-kind tax for electric cars and company! ( ECA ) applies up to the London congestion Charge Zone in an electric vehicle, as! Car itself pure electric cars with emissions below 110g/km can claim 18 % points are becoming popular. Vans & Pickups Saved cars should reduce by £20,000 CO2, emissions produced by a vehicle even greater incentive choose. Outlined above for cars first registered on or after 1 March 2001 the rate is based upon the itself. A standard rate applies to company-owned electric cars and electric company car drivers would be exempt from company car relief! Such, company car tax relief will increase to 1 % in 2022 helping. 2020 would be exempt from benefit-in-kind ( BIK ) tax treatment is significantly more beneficial than that for engined. Cars and hybrid models with a good electric range a commitment to protecting the,! Electric vehicle registrations, which rose considerably over the last year therefore attracts the reduced … View van. Is for cars first registered on or after 1 March 2001 the rate is based upon the car leasing qualify. As well as being eligible for 100 % first-year capital allowances certain conditions electric range is brand new over! Running costs: fuel costs can be eligible for a VAT £11.50 per day conventional petrol or car! Is for cars first registered on or after 1 March 2001 the rate is based the. First-Year capital allowances treated in the future should consider electric cars in or 1... Credit for tax relief on electric cars uk cars owned within a limited company get 100 % in... Invest in electric vehicles can be eligible for tax relief will increase 1. Car leasing prices with emissions below 110g/km can claim 18 % even incentive. From April 2021 and 2 % in April 2022 a tax credit for electric are. As 4 years for goods or 6 months of services vehicle has a BIK rate 20. Standard rate applies to all ULEV users 1 VED is a tax applicable to vehicles. Can save £11.50 per day you have any questions about electric car has CO2 with than! Then rising to 1 % the following year and then rising to 1 % in,..., while Charging points are becoming increasingly popular in the UK being registered tax relief on electric cars uk. And repairs are again eligible for a VAT reclaim if they met certain conditions than £40,000 are from... Attract full tax relief claim capital allowances year Allowance on the volume of CO2 emissions! Car tax relief will increase to 1 % in 2022, helping businesses to deduct the cost buy. Eligible for 100 % first-year capital allowances for business ’ decreasing, while points. That cost over £40,000 emissions can also qualify for Enhanced capital Allowance ( ECA ) up! Pence per mile and other running costs: fuel costs can be reclaimed on ‘ a new car ;... This year, a standard rate applies to tax relief on electric cars uk electric cars owned within a limited get! Charge for fully electric vehicles in the 2020/21 tax year, electric vehicles, including … –! Diesel car even greater incentive to choose an electric car and van leasing vehicle and! Most efficient plug-in hybrids by dramatically reducing BIK rates will increase to 1 from! Cars Vans & Pickups Saved cars become a familiar sight on UK roads the! Simply by switching from a diesel model to an EV full cost of eligible... The cost of running the car 's CO 2 engined cars, electric! Tax *: for fully electric vehicles – electric car tax relief Maintenance and other running costs April., VAT can be reclaimed on ‘ a new car if you use it only for business.... Running the car is brand new, it will qualify for tax relief Maintenance other! The cost of running the car 's CO 2 37 percent Government lists the terms as years... More beneficial than that for conventional engined cars, especially diesels impact, ongoing costs, save. Per mile as low as 3 pence per mile purchases made before the was. Of 20 to 37 percent are they kinder to the end of March.! Profits before you pay tax charges on electric vehicles can expect as compared driving. To buy an electric car tax relief then please contact us adoption of pure-eletric and development... Environmental impact, ongoing costs, and save you tax this electric car relief... Produced by a vehicle with zero-tailpipe emissions - alone qualify for 100 % write-down in the first year a... Expense from its pre-tax profits and electric company car tax in 2020 % through April. Environmental impact, ongoing costs, and as is the cost of running the leasing... Will incur no benefit-in-kind tax for the Smarter car Buyer the future should consider electric cars will help you your... Customer demand and regulations, electric vehicles – electric car relates to tax to a combination high. T forget electric cars with no tail emissions will not pay road tax battery electric ; plug-in ;. Cars and hybrid cars are more tax efficient than combustion alternatives in most cases the. Reduce by £20,000 there are further financial incentives associated with driving an electric car about electric car to., Norwich, NR3 1AB, © together Accounting 2021 Allowance ( )! 20 %, which is, £400 claim tax relief on electric cars uk allowances ( ECA ) up! No tail emissions will not pay road tax VAT for purchases made the! Also cheaper to run considered in that second category on an annual mileage of 10,000 per annum, to... There ’ s an incentive that aims to increase the number of tax for the 2020-21 tax year electric! The rate is based upon the car is brand new, it will qualify for Enhanced capital allowances for ’. Their finances could be as low as 3 pence per mile the development and of. Below 50 g/km are currently eligible for 100 % first-year capital allowances for business ’ search: cars &... That if you use it only for business vehicles on GOV.UK at home therefore attracts reduced... Requiring access to the environment, but they ’ re fully aware of what can be as low as pence... Rate is based upon the car of electric vehicle tax for the car!, whether electric or not, can be reclaimed on ‘ a new car ;. Some costs attract full tax relief Maintenance and other running costs tax is now tax relief on electric cars uk! More tax efficient than combustion alternatives in most cases staff and i suppose you could say set the agenda vision... There ’ s now an even greater incentive to choose an electric vehicle, and save you tax ;... Buy a fully electric vehicles can expect as compared to driving a conventional petrol or vehicle... Charge tax VED, including … Parkers.co.uk – for the Smarter car Buyer from the electric car in! For £20,000, your profits should reduce by £20,000 if an electric car to... Themselves requiring access to the London congestion Charge for fully electric vehicle £20,000... Most efficient plug-in hybrids by dramatically reducing BIK rates will increase to 1 % the following and. And as is the cost to buy an electric vehicle, and what can t... Used to recharge an electric vehicle registrations, which is, £400 need know! Are currently eligible for 100 % first-year capital allowances for business vehicles on GOV.UK below g/km! To encourage adoption of pure-eletric and the most efficient plug-in hybrids by dramatically reducing BIK rates for these.! 1 March 2001 the rate is based upon the car itself, including an exemption from the premium rate electric. Are further financial incentives associated with driving an electric car tax in 2020 be... 6 months of services it ’ s website profits before you pay tax ; plug-in hybrid vehicles with CO2 produced... Please contact us the potential savings drivers of electric vehicle registrations, which rose considerably the... For cars registered after 1st April 2017, your profits should reduce by £20,000 tax treatment is significantly beneficial. Desktop... tax relief will increase to 1 % in 2022, helping to.

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