BENEFITS OF ELECTRIC VEHICLES
The fuel crisis last September has encouraged many people to consider buying an electric car.
Drivers of company-owned electric vehicles will find it particularly rewarding as the taxable benefit for using an electric company car is currently just 1% of its list price and there is zero taxable benefit for using an electric company van.
The taxable benefit for electric cars is due to double from 1% to 2% of list price on 6 April 2022 but then it will be frozen at that level until at least 6 April 2025. If the company pays for the electricity to power the vehicle, either through a charging point at work or by providing a payment card for the employee to use at public charging points, there is no taxable benefit for the use of that electricity. Where the employee charges a company vehicle at home they can claim 5p per mile for business journeys driven from 1 December 2021 (previously 4p per mile).
If your electric car is in your own name you can still claim the standard 45p per mile for business journeys (up to 10,000 miles per year) and you will have zero road tax (VED) to pay.
Where your company has the cash available to buy an electric car it can get a 100% deduction for the cost in the year of purchase with electric vans currently qualifying for a 130% deduction.
There are also government grants of £2,500 available for the cheaper electric cars and for installing charging points.
This article has been extracted from the December 2021 Newsletter