06/05/2026
Assuming you have already decided that an electric or hybrid car is practical for your needs, what are the benefits of having the company buy or lease it, vs paying it out of your own pocket?
The answer is a little bit more complicated these days.
π΅ With marginal rates of corporation tax meaning businesses pay somewhere between 19%-25% of tax on profits impacting the saving of the company either buying or leasing the car.
π΅Individual tax thresholds making it cheaper for individualβs with earnings under Β£50k and more expensive for those earning over Β£50k.
π΅ VAT savings depend on how the car is taken on either as a company asset or under a lease agreement.
π΅ As the benefit in kind rates are going up by 1% each year, the benefits are reducing slightly over the longer term.
Therefore, as we do with everything at Coopers&Co, we take a case-by-case approach. We consider all the aspects above that apply to your business and personal situation then make recommendations in our opinion about what works best for you (and no, its not always just about saving tax!).
If you want to know whether taking on an electric company car is a good option for you and your business, speak to us so we can review the options with you and help you make an informed decision.