BMW i4 M50

There’s Never Been a Better Time to Switch to An Electric Car Business Lease

An ever-increasing number of business owners are leasing company cars, motivated primarily by the attractive monthly costs and the ability to change vehicles frequently. Changing a vehicle during a lease is a common occurrence. Undertaking such an arrangement, however, requires direct communication with the local dealership to explore the available options. The cost to lease the vehicle is split across the initial rental and the monthly payments. At the end of the contract, the car is inspected for any damage beyond the usual wear and tear. Also, the company checks the mileage.

When looking at options for a business vehicle, it can be overwhelming. Here’s an idea: Lease an electric vehicle. Data released by a UK comparison site for car leasing disclosed that the demand for EVs outgrew diesel and petrol cars in 2021. Depending on when and how a car is charged, your journey can cost as little as a pence per mile. Automobile technology is getting better and better, so you can follow the trend by upgrading to a more improved model as the years go by. Not only do you get tech upgrades faster, but also you don’t have to worry about battery issues that come with an ageing electric vehicle.

Leasing An Electric Car for Business Comes with A Number of Advantages

There Are a Series of Financial Incentives for Businesses

An electric car has no tailpipe emissions, so you may be eligible for financial incentives that encourage clean energy use in the UK. When leasing a brand-new vehicle to use on the job, you must pay company benefit in kind (BiK) tax for the car. The tax is calculated based on the car’s CO2 emissions. You don’t drive a polluting model, so you pay a smaller amount of tax. The tax you pay for using the car privately is 1% during the 2021/22 fiscal year. It’s due to be 2% in 2022/23. The point is that a car that runs completely CO2-free is an excellent choice for business.

If you’re not yet convinced to switch to sustainable, clean, and quiet electric mobility, perhaps these incentives will do the trick:

  • 100% First Year Allowance – A capital allowance of 100% can be claimed on all new or unused cars with zero emissions for expenditure incurred. The outcome is a saving of 19% corporation tax. Leased electric cars don’t qualify. Consider opting for a lease buyout when the time is up.
  • No car fuel benefit charge – Electricity isn’t considered a fuel, so you’re exempted from paying an employee fuel benefit charge on the electric car. More precisely, as an employer, you don’t pay Class 1A National Insurance contributions.
  • Eligibility for salary sacrifice schemes – You can pay for an electric car each month using your gross salary. It’s the same as other salary sacrifice schemes. Many leasing companies, such as Economy Leasing, provide solutions that can be implemented almost right away, including maintenance and business insurance plans.

Reducing Driving Emissions

Corporate social responsibility enhances social welfare, especially when environmental damage is serious and the efficiency of reducing emissions is low. More and more consumers are taking into consideration the environmental impact of businesses. Driving a green car is better for the environment and can help strengthen customer relationships. As the effects of climate change are intensely felt, the environmental part of corporate social responsibility is becoming more important. EVs don’t emit any pollutants nor CO2 gas. Don’t believe the myths you encounter that conventional fossil fuel-powered cars and hybrids are less CO2-emitting.

Electricity Prices Are More Stable Than Gas/Petrol Rates

Electric prices are made up of three components: transmission and distribution costs, taxes and surcharges, and commodity costs. As compared to petrol or diesel, electricity prices are very stable. Gas prices, on the other hand, can change by upwards of 100% in a very short period of time. Fully charging an electric car can typically cost between £9 and £9.90. Electricity is more affordable than traditional fuels. Overall, it depends on the vehicle you’re charging and the tariff on the electricity supplier. But it doesn’t cost as much as traditional internal combustion engine vehicles. In the UK, other than at home, there are three places where you can charge an EV: at work, at public locations, and at service stations.

Should You Lease a New or Used Electric Car?

The uncertainties brought about by the COVID-19 pandemic have many business owners rethinking their priorities and expenses. Leasing offers the flexibility of not getting locked into a long-term commitment when financing a company vehicle. It’s an excellent way of getting a new or well-maintained car for a relatively affordable price. In case you didn’t know, it’s possible to lease used cars. The only problem is that finding a used electric car to lease can prove to be complicated. Used-car leasing can help you save money, yet there are some aspects to pay attention to. If the battery dies, you’re responsible for repairing/replacing it, unless you have a warranty to cover that expenditure.

If You’ve Decided an Electric Car Is for You, It’s Time to Take the Next Step

Business car leasing isn’t just for public limited companies. If you’re a sole trader or a partnership, you may qualify for a business lease agreement. After you’ve found a suitable green car, look at your company’s budget to know what you can afford. Request a quote and, if you’re happy, continue the process. The agreement can last anywhere from two to four years, depending on how long you need the car for. If you have poor personal credit and the business has strong credit, you still have a chance to get approval. The annual mileage cap and initial payment are established before the vehicle is delivered. You won’t always get an charger with the car, but you can charge the car at a regular 3-pin socket or a home/public charger.