Electric Cars Company Car Tax 2020

For a basic rate taxpayer with a 2020 registered vehicle value of 20 000 with emissions of 30 g km and an electric range of 30 miles.

Electric cars company car tax 2020. With the recent change of bik rates in april 2020 all bevs pay no company car tax in 2020 21 just 1 in 2021 22 and 2 in 2022 23 a further increased uptake of fully electric company cars is to be expected. Therefore for a pure electric vehicle with zero tailpipe emissions company car drivers will be taxed at 0 and pay no tax on the benefit in kind bik at all. Pure electric cars will not be subject to any benefit in kind tax at all for 2020 21 regardless of when the car was registered. 2020 21 company car tax for electric vehicles drivers of electric company cars will not be subject to bik tax from april 2020 changes in emissions regulations has resulted in the removal of bik benefit in kind tax on employees who drive evs electric vehicles as a company car.

Earlier this year the government revealed electric vehicles will be exempt from company car tax in the 2020 21 tax year. Battery electric and plug in hybrid vehicles with co2 emissions below 50 g km are currently eligible for 100 write down in the first year. The measure was brought in to encourage both businesses and workers to choose low emission vehicles. As with car tax and company car tax the rate at which a company can write down the value of company vehicles is based on its co2 emissions.

The government says that company car drivers choosing a pure electric vehicle will pay no benefit in kind bik tax in 2020 21. Introduced in 2002 company car tax applies to cars bought by employers for their employees private use. For cars newly registered from 6 april 2020 the majority of company car tax rates will be reduced by two percentage points. Cars registered from april 6 2020.

In 2021 22 they will attract a bik rate of only one per cent. Electric cars are exempt from vehicle excise duty otherwise known as road tax and for the 2020 21 financial year beginning 6 april 2020 they re exempt from company car tax too. How does the electric car tax credit work. As a milestone decision this is the first opportunity for company cars to be taxed at 0 as a benefit in kind bik helping businesses make the transition to zero emission vehicles and a potentially emission free future.

In its long awaited response to its review of wltp and vehicle taxes. The new company car tax band tables for 2020 to 2023 is set out below.