Leasing electric car through company?

[London1986]

Thinking about leasing an electric car through my company this year due to the favourable BIK rates after April.

Now I understand how the BIK tax works however I would be interested to hear more about the tax my company pays.

For example, if I purchase the car outright via my business, I understand 100% of the purchase price can be claimed against corporation tax for the first year.

However what happens if I lease the car? Do I expense the monthly payments?

Interested to hear from anyone who has bought or leased a car via the company or is thinking about doing so.

[jamoor]

You can expense the monthlies and reclaim have the vat unless the car is unavailable for private usage.

You can also reclaim vat/ expense fuel(electric) tyres, servicing and all other maintainace

You’d be daft not to do this if you’re a powerfully built director with a goatee.

[London1986]

Thanks for confirming.

Yeh I'll be using for private use so won't be available to claim VAT but yeh spot on about the rest of the maintenance.

I agree seems like a no brainer. I imagine we are going to see a lot of electric cars on the road this year because of this. Especially Tesla 3's!!

[jamoor]

London1986 said:

Thanks for confirming.

Yeh I'll be using for private use so won't be available to claim VAT but yeh spot on about the rest of the maintenance.

I agree seems like a no brainer. I imagine we are going to see a lot of electric cars on the road this year because of this. Especially Tesla 3's!!

You can reclaim 50% of the vat on a lease, sorry for the typo.

[lost in espace]

You could do a BCP/PCP through the company and get the 100% relief, but it has to be paid back in part when the vehicle is handed back. Leasing is more efficient unless you are going to buy a Tesla say and keep it 10 years.

[rallye101]

Does anyone know if this is the case for plug in hybrids too or just fully electric?

Got my eye on a velar p400e and wandering on the most cost efficient way to lease it on my Limited?

[85Carrera]

rallye101 said:

Does anyone know if this is the case for plug in hybrids too or just fully electric?

Got my eye on a velar p400e and wandering on the most cost efficient way to lease it on my Limited?

Full electric only

[MOBB]

rallye101 said:

Does anyone know if this is the case for plug in hybrids too or just fully electric?

Got my eye on a velar p400e and wandering on the most cost efficient way to lease it on my Limited?

Its the same, other than the BIK rates are higher for hybrids. There are some low rate hybrids (Merc A class springs to mind at 6%) but the Velar is BIK expensive sadly

[rallye101]

How about an X5 45e?, On the BMW sIte it claims 6% Bik, it's it worth a chat with our accountant or just do a business lease of a leasing website?

[jonnyefc]

rallye101 said:

How about an X5 45e?, On the BMW sIte it claims 6% Bik, it's it worth a chat with our accountant or just do a business lease of a leasing website?

Just done this myself on this very car.

Without a contribution from me the BIK this year is around £79 a month for a basic rate taxpayer.

£90 for next year.

It's a no brainer for a company car. Think the total outlay once all vat reclaims and corporation tax deductions are factored in, comes out at around £350 a month for the company on the deal I secured.

Bonkers for a £70k car.

[rallye101]

jonnyefc said:

Just done this myself on this very car.

Without a contribution from me the BIK this year is around £79 a month for a basic rate taxpayer.

£90 for next year.

It's a no brainer for a company car. Think the total outlay once all vat reclaims and corporation tax deductions are factored in, comes out at around £350 a month for the company on the deal I secured.

Bonkers for a £70k car.

Can you point me in the right direction, that sounds perfect for me!

[Sheepshanks]

jonnyefc said:

...for a basic rate taxpayer.


It's a no brainer for a company car. .

Mostly company cars are a no-brainer at basic rate. It must be pretty unique that you're able to keep your total income below the higher rate threshold.

[oop north]

rallye101 said:

Does anyone know if this is the case for plug in hybrids too or just fully electric?

Got my eye on a velar p400e and wandering on the most cost efficient way to lease it on my Limited?

If you really want a Velar p400e, to keep the tax down you need to make sure the co2 does not exceed 50g per km - and according to the configurator only the SE stays under r try hat threshold (and you can add extras that take it over). If getting one I would be making sure that the order is contingent on co2 being no more than 50g as the tax will go up quite a bit (not sure how much - just can’t keep the details in my head)

[jonnyefc]

Sheepshanks said:

jonnyefc said:

...for a basic rate taxpayer.


It's a no brainer for a company car. .

Mostly company cars are a no-brainer at basic rate. It must be pretty unique that you're able to keep your total income below the higher rate threshold.

Slightly presumptious.....

I'm a monkey, not the organ grinder unfortunately. Just worked my backside off for the past 3 years and this is my reward, on top of a 33% salary increase.

[jonnyefc]

rallye101 said:

jonnyefc said:

Just done this myself on this very car.

Without a contribution from me the BIK this year is around £79 a month for a basic rate taxpayer.

£90 for next year.

It's a no brainer for a company car. Think the total outlay once all vat reclaims and corporation tax deductions are factored in, comes out at around £350 a month for the company on the deal I secured.

Bonkers for a £70k car.

Can you point me in the right direction, that sounds perfect for me!

Speak to this guy, came up trumps for me.....

Marvin Blake
Rybrook BMW Warwick
01926 333 888
[e-mail]

[Sheepshanks]

jonnyefc said:

Slightly presumptious.....

I'm a monkey, not the organ grinder unfortunately. Just worked my backside off for the past 3 years and this is my reward, on top of a 33% salary increase.

Sorry if I’m misunderstanding but it must be pretty unique for someone paying tax at basic rate to have a £70K company car.

[jonnyefc]

Sheepshanks said:

jonnyefc said:

Slightly presumptious.....

I'm a monkey, not the organ grinder unfortunately. Just worked my backside off for the past 3 years and this is my reward, on top of a 33% salary increase.

Sorry if I’m misunderstanding but it must be pretty unique for someone paying tax at basic rate to have a £70K company car.

Why? The cost to the firm is circa £350 per month net. The cost to me is circa £70 per month net. Hardly huge sums of money.

The company is leasing the car from BMW, they haven't spent £70k on it and given it to me!

[Sheepshanks]

jonnyefc said:

Why? The cost to the firm is circa £350 per month net. The cost to me is circa £70 per month net. Hardly huge sums of money.

The company is leasing the car from BMW, they haven't spent £70k on it and given it to me!

It's great for you that you've struck that deal – I’d be interested to see the rough sums of the company side? Even with an amazing deal, I still can't figure out how it could be close to £350/mth.

One of our guys is mithering about having a Tesla but our financial guy is having none of it – although I think that’s more about not setting a precedent, at the moment we just get paid mileage, which isn't going too well at the moment!

[jonnyefc]

Sheepshanks said:

jonnyefc said:

Why? The cost to the firm is circa £350 per month net. The cost to me is circa £70 per month net. Hardly huge sums of money.

The company is leasing the car from BMW, they haven't spent £70k on it and given it to me!

It's great for you that you've struck that deal – I’d be interested to see the rough sums of the company side? Even with an amazing deal, I still can't figure out how it could be close to £350/mth.

One of our guys is mithering about having a Tesla but our financial guy is having none of it – although I think that’s more about not setting a precedent, at the moment we just get paid mileage, which isn't going too well at the moment!

I had forgotten i'd agreed to make a contribution to the monthlies, so the rough figures look like this:


Monthly rental 499.96
VAT at 20% 99.99
VAT recovered at 50% -49.99
MONTHLY costs 549.96

BiK 70
Salary sacrifice 90 -160.00

additional BiK NI net 32.20

Reduction in Corporation tax -75.26

160 346.90

[Hfs1889]

Sheepshanks said:

Sorry if I’m misunderstanding but it must be pretty unique for someone paying tax at basic rate to have a £70K company car.

Depends how you pay yourself. I’ve done a similar deal on the X5 and it will be my wife’s company car as she earns in the 20% bracket. No point paying double the tax and having it on my P11d.