Business Express is an online portal that covers the latest developments in the world of business and finance. From startups and entrepreneurship to mergers and acquisitions, Business Express provides reporting on the stories that matter most to business leaders and decision-makers.The website publishes news, press releases, opinion and advertorials on various financial organizations, products and services which are commissioned from various Companies, Organizations, PR agencies, Bloggers etc. These commissioned articles are commercial in nature. This is not to be considered as financial advice and should be considered only for information purposes. It does not reflect the views or opinion of our website and is not to be considered an endorsement or a recommendation. We cannot guarantee the accuracy or applicability of any information provided with respect to your individual or personal circumstances. Please seek Professional advice from a qualified professional before making any financial decisions. We link to various third-party websites, affiliate sales networks, and to our advertising partners websites. When you view or click on certain links available on our articles, our partners may compensate us for displaying the content to you or make a purchase or fill a form. This will not incur any additional charges to you. To make things simpler for you to identity or distinguish advertised or sponsored articles or links, you may consider all articles or links hosted on our site as a commercial article placement. We will not be responsible for any loss you may suffer as a result of any omission or inaccuracy on the website.

Companies go BIK on electric cars as eco revolution accelerates


Employees at companies in the UK are increasingly switching to electric cars due to a combination of environmental, tax relief and regulatory reasons, it emerged today.

Unprecedented demand is being seen by Azets, the UK’s largest regional accountancy firm and business advisor to SMEs, following a new strategic partnership with Total Motion, a major UK fleet management and leasing provider which offers salary sacrifice car schemes via trading company Pink Salary Exchange.

David Hedges, Employment Tax Partner, Azets, provides advice to employers looking to move away from diesel and petrol towards a green fleet, including plug-ins.

He said: “The UK’s net-zero carbon strategy is rightly focusing minds in a way we’ve never witnessed before and this is showing through increased demand for electric battery company cars.

“We are inundated with requests from companies keen to reward staff with a government-approved tax ‘benefit in kind’ through zero carbon or low carbon emission vehicles.

“Around 90% of our advisory work on company cars used to involve internal combustion engines (ICE), with the remaining 10% covering electric – now the position seems to have reversed. The trend is toward a very strong focus on the provision of electric vehicles as part of the overall employee reward package. This seems to be the trend across the UK.

“Not only that, employers, with Environmental, Social and Governance on the boardroom agenda feel it is the right thing to do for the environment as we move away from polluting fossil fuels.

“There is the perception aspect to consider these days – pulling up to a meeting in a diesel car may leave customers wondering if your company is practising what it preaches.

“There’s also the regulatory side – companies are looking to pre-empt any bans on diesel and petrol vehicles in certain locations.

“It is perhaps only a matter of time before diesel and petrol cars are prohibited from travelling in ‘smog cities’ and it is worth bearing in mind that the government has announced new proposals which would see more than 50% of all new cars sold to be fully electric by 2028, just six years away.

“One more factor is also driving demand – diesel and petrol costs are at record highs.”

Don't miss out on any breaking news or insightful opinions!
Subscribe to our free newsletter and stay updated on the go!

By submitting this form, you are consenting to receive marketing emails from: Global Banking and Finance Review, Alpha House, Greater London, SE1 1LB, You can revoke your consent to receive emails at any time by using the SafeUnsubscribe® link, found at the bottom of every email. Emails are serviced by Constant Contact

Demand for new electric cars is borne out by industry data – nearly 191,000 were on the roads in 2021, an 11.6% share of the new-car market in the UK.

David said: “According to industry forecasts, pure-electric cars are poised to make up one in six new cars on the roads this year and this will undoubtedly accelerate as the supply chain improves and the charging infrastructure grows.”

He added: “Where an employee receives a company car by reason of employment, this gives rise to a taxable ‘benefit in kind’, known as BIK.

“Income tax, payable by the employee, and Class 1A NICs, payable by the employer, are due on the ‘cash equivalent’ of the benefit.

“But conventionally fuelled vehicles are more expensive for both employee and employer – electric vehicles, and to a lesser extent, hybrid vehicles, provide significant advantages in this regard.” An illustrative example is included below.”

Azets’ strategic partnership sees the Top 10 accountancy firm provide advice to businesses on tax planning and Total Motion matching demand and marques.

Total Motion Director Simon Hill, based at the company’s headquarters in Leicester, said: “Our partnership with Azets is helping decarbonise road traffic as more companies look to the environmental, tax, staff retention and reputational benefits of pure-play electric vehicles for directors and employees.

“From 2030, which is not that far off the horizon, the sale of new petrol and diesel cars will be banned. That cut-off date is focusing many minds.”


Example EV vs ICE BIK comparison


Vauxhall Corsa SE BMW 330d M Sport Nissan Leaf Tekna Tesla Model 3
Fuel Type Petrol Diesel Electric Electric
List Price £15,356 £44,035 £34,440 £48,490
CO2 Emissions (g/km) 93 137 Nil Nil
2022/23 BIK (%) 23% 32% 2% 2%
Cash Equivalent £3,530 £14,091 £689 £970
Employee Marginal Tax Rate 20% 40% 20% 40%
Income Tax on BIK £706 £5,636 £138 £388
Class 1A NI costs £262 £2,121 £51 £146
Total Tax Cost £968 £7,757 £189 £534
Tax Saving (employee) £568 £5,249
Class 1A NI saving (employer) £211 £1,975


Recent Post: