Tax benefits of electric cars
For businesses and company car drivers there are a number of tax benefits to driving an electric car, including some significant financial incentives, such Benefit in Kind (BIK).
From April 2021, company car drivers are subject to 1% BIK liability if they choose to drive a fully electric car. This means a 40% tax payer could pay as little as £16.67 per month in tax if they are driving a fully electric car with a P11D value of £50,000.
To put that in to perspective, a petrol car with a P11D value of £50,000 and a CO2 output of 100g/km would cost as much as £400 in personal tax per month to a 40% tax payer.
In the 2022/2023 financial year, the BIK liability on a fully electric car will rise to only 2%, which further reinforces why now is such a great time to move in to a zero emission vehicle.
But if a fully electric car isn’t right for you now, many plug-in hybrid models also benefit from lower BIK liability due to their low CO2 output. To understand more about how an EV can benefit you as a company car driver, please get in touch with one of the team to discuss your individual circumstances.