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  3. Electric vs Petrol/Diesel? What are the Pros and Cons when looking to buy a Company Car?

Electric vs Petrol/Diesel? What are the Pros and Cons when looking to buy a Company Car?

Generally, there are company and personal tax efficiencies when buying an electric company car compared to a petrol/diesel car. However, you do need to consider the commercial aspects of your finance plans/funding of the company car in your company, as electric cars are usually more expensive.


Please refer below a comparison between electric and petrol/diesel cars to assist with your decision:

TaxElectric Petrol/Diesel
Benefits In Kind
Car2% of list price based on CO2 emissions ( 2024/25)15% – 37% of list price based on CO2 emissions (2023-24)
Van0% if zero carbon emissionsA fixed £3,960 for 2024-25
Employer-provided charging point
At workThere is no benefit for company cars.N/A – A car fuel benefit applies of £27,800 for 2024-25
At homeTaxable for employee carsN/A – A car fuel benefit applies of £27,800 for 2024-25
By charge cardTaxable for employee carsN/A – A car fuel benefit applies of £27,800 for 2024-25
Capital Allowances
100% First-year allowancesAvailable for all electric vehiclesFor vans or motorcycles only.
Vehicle charging points100% First year allowance on vehicle charging pointsN/A
Allowances
Mileage reimbursements (for company cars)10p per mile for fully electric company cars10p – 23p per mile for company cars
Fuel allowances45p – 25p per mile allowance for employee’s own car45p – 25p per mile allowance for employee’s own car
Updated on 3rd May 2024

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