Lee Murphy, managing director at SME specialist accountancy firm The Accountancy Partnership commented: “If the cost of fuel remains high, we will likely see more businesses look to electric vehicles as an alternative. While purchasing electric vehicles is an expensive initial outlay, for those that can afford it there are a number of benefits.
The running costs are of course lower, and electric vehicles should have greater longevity as the government starts looking to phase out their petrol/diesel counterparts. The government currently offers a grant for those buying electric vehicles, which can help with the purchasing cost, with the maximum grant available for cars currently £2,500. There are also significant tax advantages when moving your company car fleet to electric vehicles.
Whereas a petrol or diesel car attracts a percentage charge of 30% or more, electric vehicles are chargeable at a much lower rate. In the current tax year, this is just 1%. While this is set to rise in coming years, it will only do so modestly, to 2% for 2022/23 and 2023/24. If you’ve not gone fully electric, it is important to note that petrol-electric hybrids are charged in the same way as petrol cars after considering the vehicle’s electric mileage range.”