Company Car Tax for Electric Cars
The benefit in kind charge for cars with 50g/km of CO2 emissions, was calculated at 16% of the cars list price for 2019/20.
The tax charge for new zero and low emission vehicles was reduced significantly from April 2020. For tax year 2020/21, for vehicles having either zero emissions or up to 50g/km of CO2 emissions (provided the zero emission range is in excess of 130 miles) the benefit in kind is being reduced to 0% of list price. This increases to 1% for tax year 2021/22 and 2% for tax year 2022/23. The 2% rate of benefit in kind is scheduled to last until at least tax year 2024/25.
Businesses are also able to claim 100% first year allowance on the cost of new electric cars.
It is now worthwhile considering having such a vehicle as company cars.