Media outlets from the BBC down made a big fuss over the government pulling the plug on the Plug-in Car Grant. Given the much larger savings to be made around EV ownership elsewhere, it really is no big deal. Let’s look at seven ways you can save £££ by going EV, either as a company or private individual.
Private Owners
1- No Road Tax
Vehicle Excise Duty (‘Road Tax’) for a zero emissions car will cost £0. For a large engined car you could pay £600 and up annually, so over three years you would wipe out the plug-in car grant in tax savings.
2 - Renter or flat owner? Landlord gets a £350 grant towards a charge point
Under the government EV chargepoint grant for flat owner-occupiers and people living in rented properties scheme your landlord can get up to 75% off the cost of installing a home charger. That will both boost the value of your property for them and enable you to save money on getting your EV charged.
3 - Running costs are obscenely cheaper
Even with the recent home energy price hikes, you still save vast amounts of money in fuelling an EV over a fossil fuelled car. Currently EV owners are paying around 7p per mile of ‘fuel’ as against those driving diesels who will be paying 25p per mile. Over a typical annual mileage of 7,000 miles the diesel car driver would pay £1,750 a year in fuel while the EV driver would pay just £490. If you took delivery of an EV in January you would have saved more than the Plug-in grant by March the following year in fuel alone!
Companies and Commercial Use
A sizeable number of new cars on the road today are company cars and those used by businesses. A big reason for new EVs hitting the road is the tax incentives from government. This is broadly broken down into Plug-In van grant, Benefit In Kind, Capital Allowances and infrastructure installation support.
4 - Plug-In Van Grant The Plug-In Van and Truck Grant is still available, which means you can get up to £5,000 off a new electric van. Though new EV vans are significantly more expensive than fossil fuelled ones, as you can see in the running costs section above you soon start clawing that back in reduced running costs.
5 - Capital Allowance - 100% If you buy the vehicle outright you can offset 100% of the value of a van or car used solely for business against tax. Speak to your accountant on the matter but this could wipe out your tax payments for a year or more!
6 - Benefit In Kind - Company Cars Whether an executive at a larger company or a smaller business owner who has a Limited Company, you can save big in Benefit In Kind from the HMRC. Briefly, the HMRC taxes the user of a company car if it is also used for personal reasons. BIK can be rated as high as 37% on a fossil fuelled car and at just 2% for an equivalent EV.
If your boss thought you worth having a top end, £90,000 Tesla Model S Performance you would pay £30 a month in extra tax in BIK. For an equivalent £90,000 Mercedes S 450 L AMG Line you would pay £1,100 a month! With £1,170 (close to the Plug-In car grant every month!) extra in your pocket, you can see why people would choose an EV company car.
7 - Company EV Charging Infrastructure Grants The government is offering up to £350 or 75% the cost in grants per charger installed on business premises, up to a total of £14,000 via the Workplace Charging Scheme. This can save you and your business significant amounts of money as against using diesel vans or car fuel immediately they are installed.
The Takeaway Given all the government money sloshing about for going electric, the Plug-In Car Grant is almost an irrelevance these days. Unless the government were to boost it to £5,000 or more for private individuals then the savings you make start to outstrip the £1,500 almost from the day you drive away in one.
Story by ZPN ENERGY
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