Iain Rankin suggests that now may be the time to make the switch to an electric company car.
Directors and employees who drive fully electric company cars will continue to benefit from a 2% benefit-in-kind rate in 2022/23 and 2024/25. When we consider that such vehicles were taxed at 16% of the list price in 2019/20, we can see the tax benefits of electric cars as fuel prices continue to soar, despite the Chancellor’s recent fuel duty cut.
By way of example, the 2019/20 benefit-in-kind charge for a £70,000 Mercedes EQC was £11,200, but for 2022/23 this will be £1,400.
Salary sacrifice
Normally, if an employee has a company car provided by their employer under a salary sacrifice arrangement, the taxable benefit is the higher of the salary given up or the taxable car benefit.
The provision of a fully electric car under a
