By Lucy Wayment on Small Business UK - Advice and Ideas for UK Small Businesses and SMEs
Not long ago, owning an electric car was for die hard environmentalists, owing to their poor range, unappealing designs, and relative expense.
Today, it’s a different story, with the number of electric vehicle (EV) registrations growing by 70% between 2020 and 2021. Even the most affordable EVs can do 150 miles on a single charge and many look indistinguishable from their fuel-based equivalents.
And while they are still more expensive to buy outright, with an electric car business lease, you and your employees can access the latest models for a low monthly payment. You’ll also benefit from reduced taxes, and lower maintenance and running costs.
As of 2022, there are 60 models of electric car on the market, with the likes of Mercedes, Vokswagen, and BMW all offering an EV, so you can save money and save the environment while travelling in style.
Check out our top benefits to taking out a business lease on an electric car below.
>See also: How to buy an electric car through your business
Save the environment
More than 41% of global transport emissions (which are responsible for one fifth of total CO2 emissions) are produced by passenger cars. By leasing an electric vehicle as your company car, you’re making a simple change that will have a big contribution towards helping the UK reach its net zero target.
As an added bonus, with sustainability becoming an increasingly important purchase factor for consumers, driving an electric car is a great way to broadcast your green credentials and encourage loyalty from your customers.
Save money
Leasing electric cars allows you and your employees to drive around brand new models for a fraction of the cost of buying those same cars outright. For example, you can lease a small electric hatchback from around £300 per month and you can even lease the latest Tesla for just £650 per month.
By mean value, electric cars (£32,779) are still more expensive than petrol or diesel cars (£25,685). However, it costs just £467.40 on average for EV drivers to power 8,000 miles of travel, compared to £1,199.40 in fuel costs for petrol and diesel drivers to cover the same distance. Additionally, because EV’s are much simpler machines, with very few moving parts, maintenance is just £304 per year compared to £498 for fuel cars.
This all adds up: research from LV found that, of 13 electric cars, seven were cheaper to run over a four year lease than a fuel car.
On top of that, as the lease company is still the registered owner of the car, you also won’t have to worry about its depreciating value.
Save on tax and VAT
If you lease any car with emissions below 50g/km, you can fully deduct your rental payments as expenses and offset them against your profits.
And, provided you don’t use the car for personal use, you can also claim 100% of the VAT back. Even if you do use it for personal reasons, you can still claim back 50%.
This is a huge saving – and a key reason that lots of businesses are choosing electric leases.
>See also: 8 of the best electric cars for small business leasing
Charge your vehicle at home and for free
Once upon a time, you’d be hard-pressed to find a charging point for your EV. Now, however, you can find charging points at petrol stations and on the street, and you can even charge for free at some supermarkets.
What’s more all new build homes are now required to have charging points fitted and electricity providers are offering lower rates on special tariffs for electric vehicle owners.
Lease a hybrid
If you’re not totally sold on EVs, you could always lease a hybrid. These allow you to take advantage of the cost and environmentally friendly benefits of an electric engine without having to worry about running out of juice and not being within reach of a charge point. When you do run out you can just switch to petrol power for the remainder of your journey.
And of course, the great thing about leasing is that you’re not stuck to a depreciating hybrid or EV forever. Once you’ve reached the end of your lease term, you can take out a brand new vehicle.
Next steps
Business car leasing an electric vehicle has many benefits. Not only is leasing a great way to drive a brand new car around for a fraction of the price, but choosing an electric vehicle gives you the added benefits of protecting the environment and saving money on maintenance and running costs.
What’s more you can offset your rental payments against your profits as expenses and claim 100% VAT back if you use it exclusively for work.
Battery technology is also improving all the time, extending the range of EVs, while their increasing proliferation has brought costs down considerably. There’s never been a better time to business lease an electric car.
Want to find the perfect lease for your business? Why not use our comparison tool to be matched with the most suitable provider for your needs.
Simply fill in our free quote-finding form, and answer a few questions about your business (it takes less than a minute). We’ll match you with the best leasing provider.
The post Business leases for electric cars – could you save your business money? appeared first on Small Business UK.
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Lucy Wayment, Khareem Sudlow
