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Benefits of Electric Cars for Business

Benefits of Electric Cars for Business
Photo by Michael Marais on Unsplash

Electric vehicles are rapidly growing mainstream across all parts of the globe. With the advantages and convenience linked with electric cars, it’s no surprise that more and more people are making the switch from traditional vehicles to EVs. 

When people think of electric vehicles, the common scenarios that may pop to mind are garage charging points and shiny Teslas parked in front of massive homes. However, the government, as well as corporations, are increasingly becoming aware of the benefits that come with using electric cars, especially regarding business. 

Using Electric Cars for Business

Electric cars are usually associated with big brand names such as the new Tesla Model 3, Hyundai Kona, or the Kia EV6 – all of which are popular choices on the market right now. However, from the perspective of a business owner, using electric cars makes more financial sense, not to mention a positive move for the conservation of the environment. 

Apart from various grants and taxes, owning an EV also offers significant reductions in cost throughout the duration of your ownership. An electric car can already be driven for as short as 1p every mile, as opposed to 8 for 10 per mile. Electric vehicles also come with fewer maintenance fees to worry about compared to traditional cars. 

To elaborate further, here are some of the benefits that using electric cars for business can offer. 

1. Tax benefits 

If your company opts to purchase an electric vehicle to be used for your business, you get to enjoy a 1% tax via the Benefit in Kind. In contrast, personal electric vehicles that are also used for business require owners to pay the Benefit in Kind tax. The tax rate for EVs initially was 16%, though this has been reduced to zero since 2020, merely rising to 1% during April this year. This is also projected to increase up to 2% up until 2025. 

It’s worth noting that the rate for the Benefit in Kind tax for higher emission cars reaches about 30% on average, which means that owning an EV can save you a great deal of money. Besides, owners of electric cars are also exempt from fuel duty, road tax, van benefit charge, and vehicle excise duty. 

3. Government subsidies and grants

Buying a new electric vehicle for your business means that you can also be eligible to avail of the government’s low-emission cars plug-in grant that covers taxis, cars, mopeds, motorcycles, and Trax. Maximum grant goes as high as £2,500 for cars while trucks and vans range somewhere between £3,000 and £16,000.

Grants from the government are usually bestowed to select manufacturers or dealerships, which means that you still need to look for the brands under this scheme to qualify. Also, the vehicle should have at least 70 miles of electric range to be eligible, and hybrids are required to have combined emissions of CO2 that are only either equal to or less than 50g/km. 

4. Incentives for Traveling

A few good reasons why it’s worth considering switching to electric cars for business use are its financial benefits and efficiency. Those who are frequently driving to and from work within urban areas can be exempt from congestion charges alongside other expenses that can take a huge chunk of your typical budget per month. You also get an opportunity to save at least £12.50 a day as part of the ULEZ or Ultra Low Emission Zone which is planned to be laid out in other cities as well. Using electric cars is more cost-effective, and it significantly reduces the hassle usually experienced when travelling to work and back. 

5. Car Charging 

If your business or company opts to install charging points for electric cars between this moment and March 2023, approximately 100& first-year allowances can be obtained on the investment. Besides this, if you permit your employees to charge their electric vehicles in your work area for free, this wouldn’t qualify as a taxable benefit in kind. 

Additionally, the Workplace Charging Scheme provides vouchers aimed towards buying expenses and installing various charge points within the premises of your business which is quite handy and useful.

5. Increased credentials for sustainability

Thorough sustainability planning and comprehensive corporate social responsibility are now deemed a must-have for all businesses. Moving an entire fleet and switching to electric vehicles not only provides financial benefits but also demonstrates the company’s commitment and dedication towards helping with pressing environmental issues. It also helps the branding of the business and offers you a chance to give back to the world. 

Recent technological developments in the electric transport industry mean that there are zero gaseous emissions from EVs, averaging somewhere between 15 to 40% less CO2 emissions throughout their lifetime unlike petrol or diesel cars. 

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