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Flicking the switch could save company cash

Shropshire business owners and company car drivers could save thousands of pounds and boost their green credentials by switching to electric vehicles.

The Government has already announced that electric cars and vans will need to make up at least 60% and 40% of sales by 2030 if they are to meet tough environmental targets.

And so, they’ve introduced significant tax incentives to encourage drivers to think about choosing a greener option.

Kate Thorburn, from our tax planning team said:

“Company cars are still seen as a valuable part of an employee’s remuneration package, so there’s likely to be a move towards more eco-friendly vehicles thanks to their reduced benefit-in-kind charges.

“Luckily, company car benefit-in-kind rates are set in advance, so this will help business owners and company car drivers to review their vehicles to work out the potential cost savings.”

Kate said pure electric cars were also exempt from road tax which would bring an additional saving, and all cars that emitted less than 75g/km of carbon dioxide would pay less road tax in the first year.

“From next month, if your employees plug in and charge their electric cars at your company premises, they will not be liable for benefit-in-kind payments either.”

Kate said some plug-in vehicles were already benefiting from Government grants, with the grant applied directly at source so there was no additional administration for the company involved.

“The Government’s aim is to make electric cars and vans more affordable for your company and employees, so choosing the greener option makes excellent financial sense.

“If you’re already running a company car scheme through your business, now would be a good time for you to review and update the list of vehicles offered to your employees, so that you can make sure you are maximising the allowances available.”

 

Kate Thorburn, Tax Assistant

The Author

Mel Edwards

Mel Edwards

Marketing Assistant

Mel joined Dyke Yaxley in May 2017 as a Marketing Assistant after spending 2 years as an Administrations & Marketing Manager for a local Shrewsbury healthcare agency...