Electric Car Update

We have previously written extensively about the tax benefits of electric cars and if you are a business owner needing to drive and wanting to save tax, it is well worth reading this blog post.

Bottom line: if you go fully electric, you’re currently looking at a 3% charge, whereas if you go for a diesel or petrol car with higher CO2 emissions, you could be looking at anything up to 37%.

There is however, an update on the rates. At the moment (July 2025), the Benefit In Kind (BIK) rate for fully electric cars is 3%. This is set to go up by 1% a year until 2028, followed by increases of 2% until it reaches 9% for the 2029/2030 tax year.

That is still a significant saving compared to 39% for petrol and diesel cars, and even hybrid cars, as you can see from the table below*:

Tax years	Fully Electric	Petrol/diesel
2025/2026	3%	36%
2026/2027	4%	36%
2027/2028	5%	37%
2028/2029	7%	38%
2029/2030	9%	39%

*These are simplified rates as there are various categories, depending on mileage and emissions. If you want to know the BIK rate of your particular car, please contact us.

P11D

All the tax rates are applied to the P11D value of the car. The P11D company car value is the vehicle’s list price, including VAT and charges of delivery, excluding registration and tax. The P11D company car value does not change, as it is the one the manufacturer quotes.

IMPORTANT NOTE

If you have a company vehicle with private use, you will need to file a P11D by the 6th of July 2025. So if you have purchased a company car (electric or otherwise), please let us know as soon as possible so that we can register it as a benefit in kind and prepare your P11D for you.

CYCLE TO WORK

At Focus we are very keen to be as carbon neutral as possible, so we greatly encourage you to look into cycling to work as an alternative to using any car at all. Not only does it save you money, you improve your health at the same time. A true win-win situation.