Tax on electric cars

Since April 2020, electric cars have become very tax efficient.  For example:

Buying an Electric Car (as Company car)

If you take £30,000 profit from a company to buy an electric car:

Car cost = £30,000.

Corporation tax = £0;

Income tax: Benefit-in-kind rate = 2% in 2023/24, so income tax and NI perhaps £323).

Buying Petrol/Diesel Car (as Personal car)

If you use £30,000 profit to buy a personally-owned fuel car.

Extra Corporation Tax in the company (at 19%) = £5,700

Take a £24,300 dividend. Then you must set aside money for higher rate income tax on the dividend (marginal rate: income tax/dividend tax 33.75% (2023/24) = £8,201

This leaves only £16,099 available for a petrol/diesel car.

Cash to HMRC = £13,901.  This is about an extra £13,578 compared to it going through the company.