Still not sold on the idea of using electric vehicles for your business? There are at least a dozen practical reasons why they make good sense, especially if you start with used electric cars in Scotland.
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Electric vehicles are currently more expensive to buy or lease than petrol or diesel vehicles.
So as a business owner, you may be asking: is it worth investing in them?
The answer is yes, and there’s lots of support available, such as Energy Saving Trust’s interest-free loan for used electric vehicles and their chargepoint funding specifically aimed at businesses to cover up to 75% of the cost of a chargepoint.
Here are a dozen reasons why EVs are worth your money.
12 reasons to use electric vehicles for your business:
1. Lower or zero vehicle excise duty (VED)
Zero emission cars are exempt from VED until March 2025. The first-year rate is also lower for electric vehicles – only £10 compared to £120-£945 for petrol or diesel vehicles. After that, all vehicles will be charged a standard rate of £165 per year.
2. National Insurance tax advantages
The class 1A National Insurance Contributions (NIC) that employers with electric company cars must pay is significantly lower than those with internal combustion engine (ICE) company vehicles. Company car tax, which only applies to the employee, is also much lower for electric cars.
3. Corporation tax liability
Businesses buying cars can write down 100% of the purchase price against their corporation tax liability if the vehicle is fully electric and emits no carbon dioxide.
4. Enhanced Capital Allowances
New electric cars and zero emission goods vehicles qualify for 100% of first-year capital allowances. This means you can deduct the total cost of the vehicles from the profits that you’d usually pay tax on.
Equipment for electric vehicle charging points are eligible for the same allowance.
Commercial vans, lorries and tractors are eligible for a 130% super-deduction capital allowance or a 50% first-year allowance.
5. No van benefit charge
This applies to drivers of zero emission vans.
6. No fuel benefit charge and no benefit in kind liability
This is for electricity provided by an employer to charge employees’ own electric vehicles.
7. Advisory fuel rate
Drivers of fully electric company cars can claim 9 pence per mile for business use. This is usually updated quarterly.
8. Clean air charges
You won’t have to pay any charge if you’re travelling through a clean air or ultra low emission zone. Drivers who enter low emission zones using non-compliant vehicles will face a penalty charge of £60.
9. Lower servicing and maintenance costs
Electric vehicles are significantly cheaper to service than petrol, hybrid or diesel models, according to bookings data published by Book My Garage last February.
On average, electric vehicle servicing costs £103. That’s lower than hybrid vehicles (£159), petrol engine cars (£151) and diesel cars (£163).
The overall average maintenance bills for electric vehicles cost up to 43% less compared to cars using other types of fuel.
10. Higher residual value
Electric vehicles currently have a higher residual value than petrol and diesel cars. Residual value is how much a vehicle will be worth when the lease term for it is over.
11. Used electric vehicle loan for business
If you’re a business owner who wants to switch to an electric vehicle, Energy Saving Trust can offer you an interest-free loan to purchase used electric cars in Scotland. You can also opt to buy a hydrogen vehicle from an acceptable dealership.
Depending on how your business is registered, you can borrow as much as £90,000 and repay the loan over five years.
Are you eligible? Find out here. But you should act soon as applications close on November 30 2023.
12. Business chargepoint funding
Transport Scotland, through Energy Saving Trust, can help you install electric vehicle charging infrastructure on your business premises. They can cover up to 75% of the cost to buy and set up a chargepoint at your business address.
Learn how you can apply for your organisation here.