A driver who is paying 20 percent tax with access to an electric car via a company car scheme will see Benefit-in-Kind (BiK) tax savings of between £1,000 and £2,000 per year. Very low BiK rates have been a key factor in electric car adoption from when it was first introduced.
Industry experts have said how these savings had become even more decisive in the last few months with the ongoing cost of living crisis.
For both individual drivers and entire fleets, motorists are taking advantage of electric cars given the lower tax rates.
Through the BiK system, fully-electric cars attract a tax rate of just two percent, which will remain until the 2024-2025 tax year.
Most hybrid models see tax rates below eight percent while almost all petrol and diesel cars are taxed between 20 percent and 37 percent.
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Given the incentives on offer for electric vehicles, the swing of vehicles is staggering with a 40 percent reduction in diesel vehicles compared to two years ago.
In the first three months of 2022, there were 2,722,060 company cars in the UK.
This is an increase of almost 47,000 compared to the previous quarter, despite global supply chain issues.
Mr Edwards continued, adding: “At the prestige end of the market, which may be reserved for directors or senior staff, manufacturers generally have been able to offer more EV choices, but it is in the lower grades that the selection of models has been relatively limited.
“Here, by opening up choice lists, we are seeing some manufacturers make inroads into the fleet sector who have not necessarily been part of the core company car market in the past but are now able to provide strong EV models with comparatively good supply.”
Drivers who are interested in taking up such an offer are now being urged to look into it as soon as possible, given the long waiting times for new vehicles.
Some vehicles, including many electric cars, have waiting times of at least three months, with some popular models seeing delays of up to a year.
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