Electric car leasing deals

What Is Electric Car Leasing?

Electric car leasing means paying a fixed monthly fee to use an electric car for an agreed length of time, usually two to four years. You do not own the car. Instead, you pay to drive it, then hand it back or move on to a new model at the end of the contract.

Leasing suits businesses because it avoids the large upfront cost of buying a car outright. It also means fewer surprises, since maintenance, road tax and breakdown cover can often be bundled into one simple monthly payment.

What Is Electric Business Car Leasing?

Electric business car leasing is when a company leases electric cars for its employees to use for work. This is sometimes called business contract hire, or BCH.

It works well for sole traders, small businesses and large fleets alike. Here is what usually happens:

• Your business chooses one or more electric models.
• You agree a contract length and yearly mileage.
• You pay a fixed monthly amount, which can often be offset against tax.
• The car is returned at the end of the lease.

Why Do Businesses Choose Electric Leasing?

• Lower running costs. Electric cars cost less to charge than petrol cars cost to fuel.
• Tax efficiency. Businesses can often reclaim VAT and offset lease costs against profits.
• Predictable budgeting. One monthly payment covers most costs.
• No resale worries. You do not need to sell the car when you are finished with it.
• Cleaner image. Driving electric supports a business's environmental goals.

Why Are More Company Car Drivers Choosing EVs?

Company car drivers are moving to electric vehicles because the savings are hard to ignore. Since tax on electric company cars is so low compared with petrol or diesel, many drivers find an EV lease costs far less each month once tax is taken into account.

Other reasons drivers like EVs include:

• Quieter, smoother driving.
• Lower fuel costs, since home charging is usually cheaper than petrol.
• Access to newer technology, such as driver aid systems and bigger touchscreens.
• Fewer moving parts, which can mean less time off the road for repairs.

Are Electric Cars Reliable Enough for Daily Business Use?

Yes. Modern electric cars are built for daily use, with ranges that easily cover most business trips. Many new EVs now travel over 250 miles on a single charge, which is enough for a full day of driving for most company car users.

What Is Salary Sacrifice and How Does It Work With EVs?

Salary sacrifice is a scheme where an employee gives up part of their salary in exchange for a benefit, such as an electric car. The employee pays for the car straight from their salary before tax is taken off, which lowers their income tax and National Insurance.

This makes salary sacrifice one of the most tax friendly ways to get an EV in the UK today.

How Does a Business Set Up a Salary Sacrifice Scheme?

• Choose a leasing partner, such as XLCR Vehicle Management, to manage the scheme.
• Offer a list of approved electric cars to staff.
• Employees pick a car and agree the sacrifice amount.
• The leasing cost is deducted from gross salary each month.
• The business can also save on employer National Insurance contributions.

What Is Fleet Referral?

Fleet referral is where a business works with a leasing broker to introduce electric leasing to its staff, customers or partners. XLCR Vehicle Management can support fleet referral schemes, helping businesses offer great EV deals to their network while also building stronger relationships with suppliers and customers.

What Should You Think About for Charging?

Charging is one of the biggest questions businesses have about switching to electric. The good news is that charging has become much easier in recent years.

Can Employees Charge at Home?

Yes, and this is often the cheapest and most convenient option. A home charge point can fully charge most EVs overnight. Many businesses also offer to cover the cost of home charging equipment or reimburse employees for the electricity used.

What About Charging at Work?

Installing charge points at a workplace is a great option for businesses with several EV drivers. Benefits include:

• Cars are charged and ready each morning.
• No need for employees to rely on public chargers.
• Charging can often be offered to staff as a tax free benefit.

What About Public Charging?

Public charging points are useful for longer journeys. The UK's charging network keeps growing, with rapid chargers now found at motorway services, supermarkets and town centres. It is worth choosing a car with a longer range if your drivers regularly travel long distances.

What Are the Tax and BiK Rules for Electric Cars?

Benefit in Kind, known as BiK, is the tax paid by employees who use a company car for personal journeys. Electric cars have by far the lowest BiK rates of any fuel type, which is one of the biggest reasons businesses and staff are switching.

How Much Tax Will I Pay on an Electric Company Car?

BiK rates for fully electric cars are set to rise slowly and predictably over the next few years, giving businesses time to plan ahead.

Even with these small rises, electric cars remain far cheaper to tax than petrol or diesel cars, which can attract BiK rates of up to 37%.

How Is the Tax Worked Out?

The BiK charge is worked out using this formula:

P11D value (the car's price) × BiK rate × your income tax rate = yearly tax bill

For example, a £40,000 electric car at a 4% BiK rate for a 40% taxpayer works out at around £53 a month. This is a fraction of what you would pay on an equivalent petrol car.

Are There Other Tax Benefits for Businesses?

• Businesses can often claim capital allowances on electric cars.
• VAT may be reclaimable, depending on how the car is used.
• Employer National Insurance costs are usually lower on EVs than on petrol or diesel cars.

What Are the Most Popular Electric Cars to Lease?

Some electric models are especially popular with UK businesses because they balance range, price and comfort well.

Every business has different needs, so the right model depends on your typical mileage, budget and the type of driving your staff do.