The gasoline crisis has made electric cars more attractive than ever – but paying for them could keep you from switching.
A little-known tax break could make all the difference. If you can convince your employer to sign up, you can cut the cost of leasing a brand new electric car in half.
For years, employees have had the opportunity to get a new bike or childcare vouchers as part of a wage waiver. Now employers are realizing that there are tremendous benefits in offering their employees electric cars in the same way.
Edinburgh-based start-up loveelectric, which specializes in delivering electric cars through payroll programs, says a taxpayer with higher tax rates (those earning more than £ 50,271) will typically pay the cost of leasing a popular Tesla Model 3 can drop from £ 524 to £ 267 per month by using this option in place of a traditional lease. This requires a lease term of 48 months and an agreed mileage of 5,000 miles per year.
“A lot of people still don’t know that there is a ‘Bike to Work’ program for electric vehicles,” says Steve Tigar of loveelectric. Photo: Miles Willis / Getty Images
“A lot of people still don’t know that there is a ‘Bike to Work’ program for electric vehicles,” says Steve Tigar, the man behind loveelectric. He says the fuel crisis only fueled interest in electric cars.
The lease payments for the car are deducted from your gross salary, so you pay less income tax and social security, and your employer also reduces their social security contributions.
“Taxpayers with a higher tax rate can typically cut their monthly payments in half, but there are also significant savings for taxpayers with a base tax rate,” says Tigar. “The case for electromobility was already strong, and now it’s overwhelming.”
Tigar, who markets the program to employers as “a nice little employee benefit that doesn’t cost you a dime,” says the biggest problem is finding enough electric cars to meet demand.
Waiting times for the Tesla Model 3 – his most requested car – are up to two months, although he says you can often get other models faster by working directly with dealers.
The increase in social security next April will only make the system more attractive
The program will particularly appeal to higher taxpayers who travel a reasonable distance to work each day – 30-40 miles each way – and currently spend £ 12 a day on fuel. They can lease an electric car for the same amount. Loveelectric is currently promoting the Nissan Leaf for £ 159 per month and the VW ID.3 from £ 173 per month for taxpayers with higher tax rates.
The increase in social security next April will only make the system more attractive. The icing on the cake is the fact that company car drivers will only pay a maximum of 2% of the company car tax on electric vehicles by 2025.
For many, the only problem will be convincing their employer to offer the program, although there are a multitude of companies that will manage the entire process on their behalf. Octopus Energy has a program called Electric Dreams and is part of a variety of specialist companies that offer a one-stop shop.
Loveelectric says a taxpayer with higher tax rates could cut the cost of leasing a Tesla Model 3 from £ 524 a month to £ 267 a month by opting for a pay sacrifice rather than traditional leasing. Photo: David Rawcliffe / Alamy
Simon Down, Associate Director at Deloitte and the proud driver of a 100% electric car purchased as part of his company’s program, says employers are recognizing that there are other benefits besides the potential savings.
“Most large companies are committed to getting their carbon footprints to zero by a certain date, and converting their fleets to electric vehicles can play a huge role in this, especially vehicles used for corporate business purposes or for getting to and from Workplace to be used. ” he says.
“At Deloitte, our wage waiver program is open to over 18,000 employees, and in the past 12 months we’ve seen an increase in the number of cars in our program, with almost all employees opting for fully electric vehicles, which will help us deliver our commitments Sustainability and CO2 reduction. “
There are a few factors to consider before signing up. This can have an impact on your retirement, especially if you are about to retire. If you quit your job during the term, an early termination fee is charged in some agreements. Check what it is before you sign – and see what happens when you take parental leave.
Used electric cars that won’t break the bank
If the fuel protests have made you think it’s time to buy an electric car – and you don’t want to lease one – here are our pick of the best used bargains.
Renault Zoe
You can now pick up a pristine, low-mileage Renault Zoe for less than £ 6,000. For this money you get the 22 kWh model with a real range of 70-85 miles – depending on the weather and terrain – perfect for local trips and short trips. Most of the people who sell these are buying electric vehicles with a longer range. Battery rental is extra and adds £ 59 per month.
Nissan Leaf
The first best-selling electric car in the UK and a great used bargain – the technology has proven itself and is cheap to buy. The older models can be purchased for just £ 4,700 (2011 model with 75,000 miles on the clock). Buyers looking for the bigger 30 kWh battery and faster charging will have to find £ 10,000 – but you get around 130 miles of range, compared to 120 miles for the older cars.
MG ZS EV
To MG ZS EV. Photo: ZarkePix / Alamy
MG’s family-sized electric car may have gone under the radar, but it’s a good car with one of the longest warranties on the market – seven years. It’s a great choice for growing families. A three year old car with 10,000 miles on the clock will cost you £ 18,000, but you get a 44 kWh model that can get around 250 miles on a single charge. The new electric station wagon from MG are also worth a look, but cost more.
Hyundai Ioniq
A family-sized premium electric car with a range of 120 to 130 miles and a large and practical trunk. You have to find £ 16,500 for a 2019 model with 80,000 miles but you will be rewarded with many things. However, at this price you are almost better off leasing it again.
