Basic Company car rules for Electric Vehicles

[ASB]

Newbie here looking for some (hopefully) basic advice.

I'm looking to buy/lease a new car through my company. It's an electric car with a small onboard motor to recharge the battery as and when required (BMW i3 for those that are interested) While that's on order (not ordered yet) I am looking to hire one to see how it fits in to my lifestyle. Questions arise such as
1. The hire car would be around £1000 per month. If I hire this in my ltd company name, what is the impact to me, or my company. Note the BIK is at zero for electric cars,(5% currently for the one that I am considering the lease option on) so there shouldn't be any personal tax issues at this time.
2. Does the £1000 come straight off my company tax bill, with no adverse affect on my personal drawdown, like salary and dividends.
3. Would it be better (or worse) for me to hire it personally, pay for it with taxed earnings, and then expense it to my company ?

You can see from the above that I'm looking for some clear guidance here before I plunge headlong into the exciting world of Electric Vehicles.

Hope some kind soul can help re the above

Thanks in advance

1. Assuming there is a non business purpose (and it will be pretty hard to convince anybody there isn't) then you as an individual will be charged any BIK. Assuming you go electric only then this is going to be zero. The £1k pm short term hire is an expense. So reduces corporate profit (in effect saving 200 per month tax). Generally half the VAT element is claimable (makes no difference if you are on the frs).

2. No. It's an expense it will reduce your corporate profit

3. Is is possible that you might be better off hiring it personally and claiming 45p a mile. (Highly unlikely).

A purchase is a very different question and rather more complex. It is quite likely that the capital allowance regime would make purchase of an electric vehicle cost effective given the low BIK involved on the model you are considering. A company purchase will enable the depreciation to be charged to tax (possibly all in the first year with a balancing charge on disposal, or staggered again with a balancing charge on disposal). Against this there is the BIK - which is in effect being taxed and NI'd on a couple of thousand a year.

How the capital allowance work will depend upon how the vehicle is acquired, whether it is cash, or finance. Or an operating lease or an amortised lease. I am sure BMW corporate are fully capable of explaining how it is charged to tax on the business, or your accountant.

Of course the capital alowance regime can and does change.

[v8gaz]

Also, you do realise that for 1000 a month you could contract hire an i8?

[eek]

Newbie here looking for some (hopefully) basic advice.

I'm looking to buy/lease a new car through my company. It's an electric car with a small onboard motor to recharge the battery as and when required (BMW i3 for those that are interested) While that's on order (not ordered yet) I am looking to hire one to see how it fits in to my lifestyle. Questions arise such as
1. The hire car would be around £1000 per month. If I hire this in my ltd company name, what is the impact to me, or my company. Note the BIK is at zero for electric cars,(5% currently for the one that I am considering the lease option on) so there shouldn't be any personal tax issues at this time.
2. Does the £1000 come straight off my company tax bill, with no adverse affect on my personal drawdown, like salary and dividends.
3. Would it be better (or worse) for me to hire it personally, pay for it with taxed earnings, and then expense it to my company ?

You can see from the above that I'm looking for some clear guidance here before I plunge headlong into the exciting world of Electric Vehicles.

Hope some kind soul can help re the above

Thanks in advance

Ask your accountant? You do have one don't you?

[TonyG]

Newbie here looking for some (hopefully) basic advice.

I'm looking to buy/lease a new car through my company. It's an electric car with a small onboard motor to recharge the battery as and when required (BMW i3 for those that are interested) While that's on order (not ordered yet) I am looking to hire one to see how it fits in to my lifestyle. Questions arise such as
1. The hire car would be around £1000 per month. If I hire this in my ltd company name, what is the impact to me, or my company. Note the BIK is at zero for electric cars,(5% currently for the one that I am considering the lease option on) so there shouldn't be any personal tax issues at this time.
2. Does the £1000 come straight off my company tax bill, with no adverse affect on my personal drawdown, like salary and dividends.
3. Would it be better (or worse) for me to hire it personally, pay for it with taxed earnings, and then expense it to my company ?

You can see from the above that I'm looking for some clear guidance here before I plunge headlong into the exciting world of Electric Vehicles.

Hope some kind soul can help re the above

Thanks in advance