Should I buy an electric car?

[Kermit]

Should I buy an electric car? On average I drive about 8 miles a day and need to transport two small dogs and nothing else of any bulk. There is the very occasional 30 mile trip. I have a couple of bikes for long holiday trips and if I really have to drive a distance there is a hire car depot just down the road. I do almost no business mileage anymore.

Has anyone already worked out the economics? Lease? HP? Outright purchase? I’m told it’s 100% tax deductible when purchased by the business but only if it’s new. Cheapest new EV is about 16k. Second hand about 6k. Thoughts would be most appreciated.

[Doomanic]

Yes. Your usage profile sounds ideal.

[graham_hk]

What EV is 16k?

[Kermit]

What EV is 16k?

Skoda CitiGo

[colinicky]

I normally only do 15 miles a day max , but unless I buy a Tesla an electric car is useless as most cannot tow a trailer , even the new Mercedes EQ range can only tow 750kg ! Tesla seams to be the exception to the rule. This is going to be the next big milestone for electric vehicles. Being able to tow caravans & trailers still keeping sensible range is critical to their success. Otherwise there will be a last minute rush of people buying petrol/diesel vehicles.

On second thoughts the Tesla doesn’t work as I can’t fit 3 metre lengths of pipe in it or 3 very large dogs !

[Steve Clark]

I imagine you could fit the pipe or dogs in a Tesla X. £80k. 670 or 1020bhp. 7 seats. Will tow 2.2tn. Up a hill. Very easily.

[Stuart Keasley]

Should I buy an electric car? On average I drive about 8 miles a day and need to transport two small dogs and nothing else of any bulk. There is the very occasional 30 mile trip. I have a couple of bikes for long holiday trips and if I really have to drive a distance there is a hire car depot just down the road. I do almost no business mileage anymore.

Has anyone already worked out the economics? Lease? HP? Outright purchase? I’m told it’s 100% tax deductible when purchased by the business but only if it’s new. Cheapest new EV is about 16k. Second hand about 6k. Thoughts would be most appreciated.

Re buying it through the business, offsetting a car for privatee use against tax depends on how you buy it.

- contract hire/lease hire then the contract hire charge plus 50% of the vat (based on you using it as a private vehicle). [This bit removed, thanks JamesP for making me look a bit closer]
- hire purchase/outright purchase, you can't claim the vat back on the purchase, full value Inc vat is registered as an asset, then written down across useful life, the write down becomes an expense.

You can offset the full value of an electric car against profits in the first year if you wish.

https://www.gov.uk/capital-allowances/first-year-allowances

All other expenses, ie insurance, servicing, repairs and maintenance will be picked up by the company.

The other tax break is benefit in kind: electric vehicles are 0% of value at the moment, rising to 1% from April and 2% in 2022, so the personal tax hit is tiny.

Thoughts?? I'm seriously considering it....

[Stuart Keasley]

I normally only do 15 miles a day max , but unless I buy a Tesla an electric car is useless as most cannot tow a trailer , even the new Mercedes EQ range can only tow 750kg ! Tesla seams to be the exception to the rule. This is going to be the next big milestone for electric vehicles. Being able to tow caravans & trailers still keeping sensible range is critical to their success. Otherwise there will be a last minute rush of people buying petrol/diesel vehicles.

On second thoughts the Tesla doesn’t work as I can’t fit 3 metre lengths of pipe in it or 3 very large dogs !

VW ID.4 can tow 1000Kg

https://www.whatcar.com/news/2021-vo...%20to%201000kg.

[Ken]

If I still worked through my own limited company I would probably buy one as a tax avoidance scam. Likely a VW ID 3 or 4 or the Kia. Not a retro fit like the golf etc all of which have terrible range.

I would of course not buy a Tesla. Just yesterday this was in a presentation I was at https://iacr.org/submit/files/slides.../55/slides.pdf Slides two made my skin crawl. Slide 11 confirmed the feeling. This is the month Which has a car buyer supplement on cars, particularly electric cars and hybrids this year, and they also report on the poor quality of Tesla.

TBH I think it is too soon still. What we need is something with the range of the better Tesla but made by a proper car company.

[steelemonkey]

I am looking at getting a steam powered vehicle.
This is obviously the fuel of the future.

https://www.edie.net/news/11/Cumbria-coal-mime--Government-refuses-to-block-UK-s-first-deep-coal-mine-in-three-decades/

[Chrisch]

Should I buy an electric car? ...

Only you can answer that. Do you want an electric car?

We have a diesel estate which mostly goes to our place in France (pre-covid). This year with lockdown it has been parked up doing nothing for a long time. The MOT has just been done and the mileage for the last year was less than 3,000. I use it from time to time deliberately to keep the engine in good order - a nice run out, get all the parts up to proper temperature and so on. Without these "maintenance" miles I think it probably would have been nearer 1,000. In a normal year we do two trips to France and maybe 4-5k per trip at xmas and 3 ish at Easter. Owning the car is cheaper than a rental for the two trips.

So, like you an electric would be OK. In fact nothing would be OK barring the loss of no claims discount. Motorbike and van suffice. An electric car makes sense for me as well other than the fact that the long periods standing about doing nothing will probably not be any less harmful to an electric than it is to a diesel. I have thought about it and cannot see what there is to gain from the EV. I have a company and can put it through that and have done the same calculations as Stuart and can be as tax efficient as possible. Truth is, on such a low mileage it doesn't make much odds as the company/private issue favours high mileage (VAT back on fuel) high cost and for low mileage you are better off claiming per mile.

Environment wise the argument for EV is poor. It would not figure in my thinking. The CO2 load from manufacture is so high that the small gain in running is nonsense in the first 10-15 years of the vehicle's life.

Sorry - that doesn't answer your question does it.

[Chrisch]

I am looking at getting a steam powered vehicle.
This is obviously the fuel of the future.

https://www.edie.net/news/11/Cumbria...three-decades/

Yes. User it to generate electric to power the car

[jamesp]

Re buying it through the business, offsetting a car for privatee use against tax depends on how you buy it.

- contract hire/lease hire then the contract hire charge plus 50% of the vat (based on you using it as a private vehicle). All the research I've done, the increased costs of contract hire lease hire (for single vehicle fleet) more than outweigh any tax benefit.
- hire purchase/outright purchase, you can't claim the vat back on the purchase, full value Inc vat is registered as an asset, then written down across useful life, the write down becomes an expense.

You can offset the full value of an electric car against profits in the first year if you wish.

https://www.gov.uk/capital-allowances/first-year-allowances

All other expenses, ie insurance, servicing, repairs and maintenance will be picked up by the company.

The other tax break is benefit in kind: electric vehicles are 0% of value at the moment, rising to 1% from April and 2% in 2022, so the personal tax hit is tiny.

Thoughts?? I'm seriously considering it....

Really?

My Car lease (business) is way cheaper than the available personal offers, 3+23 profile, where as the personal deals were more like 6+23, and dearer per month.
Cheaper to take an allowance from the business, and repay the lease personally.( the allowance is less than the BIK on my V90).
Scale charges for reclaiming VAT on fuel dont work unless you are doing high mileage; at which point, lease plans dont work either: buy it out right.
I had a hybrid previously, worst of both worlds; charging infrastructure is getting better, but only if you head south and east.
I know a company running Teslas as fleet vehicles for their engineers, range anxiety is real in day to day life!

[Kermit]

Thanks for the feedback people, very helpful. I think I'll not bother. Economy would have been the primary driver but that doesn't seem to be worth it. As far as "saving the planet" my old 130k mile Golf is well maintained, rust free and good for quite a few more miles. It needs the occasional expense as things wear out (brakes; disks and pads, HT leads, that sort of thing) but it seems more planet friendly to keep it going than to scrap it and a buy a new car plus it's cheaper overall.

[Stuart Keasley]

Really?

My Car lease (business) is way cheaper than the available personal offers, 3+23 profile, where as the personal deals were more like 6+23, and dearer per month.
Cheaper to take an allowance from the business, and repay the lease personally.( the allowance is less than the BIK on my V90).
Scale charges for reclaiming VAT on fuel dont work unless you are doing high mileage; at which point, lease plans dont work either: buy it out right.
I had a hybrid previously, worst of both worlds; charging infrastructure is getting better, but only if you head south and east.
I know a company running Teslas as fleet vehicles for their engineers, range anxiety is real in day to day life!

Hmmm, thanks, my bad, was basing that observation on a like for like using VW Finance, however looking at eg Lex for lease/contract hire, it's a lot closer... will ponder further on that one...

Re BIK, it's a killer on petrol and diesel, but 1% on electric, so becomes quite a saving, even compared to vehicle allowance and buying private