Electric Car Reminder



With all the focus on Coronavirus and related matters of furlough the rest of the tax world has seemed unusually quiet.

One change that came in from April 2020 and was largely forgotten was the change in the benefit-in-kind rate for companies providing electric cars to employees. This rate is now 0% and is therefore an extremely tax-efficient option for remuneration and extraction of funds from owner-managed companies, perhaps on a lease in which the cost and part of the VAT may be tax deductible/reclaimable.

Indeed the wider world must have picked up on this fact as the best selling cars in the UK in April were the electric Tesla Model 3 and Jaguar I-Pace.

As part of an overall strategy focusing maximising reliefs and benefits it may be the time to consider electric cars for your company. Eaves and Co would be delighted to assist in providing tax cost comparisons of the various options to achieve this.