Tesla reported that as an employee, you may receive a company car for personal use as a Benefit in Kind (non-cash value). Every BiK has a tax rate that is applied to your income tax.
Tesla has updated their UK website to let people know about the 0% company car tax incentive. pic.twitter.com/LYEtPBFPKC— Third Row Podcast (@thirdrowtesla) March 12, 2020
Starting in April 2020, all Tesla cars will be eligible for 0% BiK rate during the 2020-2021 tax year. Petrol and diesel cars will be taxed at higher BiK rates — up to 37%.
In addition to general information, on the Tesla website you can find a table in which you have the opportunity to compare your tax rate for a Tesla car with a gasoline/diesel car. Their tax calculation is based on Car Price, Tax bracket and Emissions.
It should be noted that, the tax brackets for 2020 are based on the currently announced tax rates and are therefore subject to change. Benefit in Kind for electric vehicles for tax year 2019/20 is 16%. It is planned to change to 0% in 2020/21, 1% 2021/22 & 2% in 2022/23.
While every effort has been made to reflect the above information in a correct and up to date manner, the company cannot exclude the possibility that any of this information is not or no longer, especially as some of this information is subject to change by third parties. More specifically are the variables for the comparison cars based on information sourced in January 2020, which variables may be subject to change and result in an inaccurate comparison if they do. For that reason, this information should be considered as indicative.
Benefit in Kind values are calculated using the vehicle 'list price', which excludes the Government Plug-In Grant incentive. Benefit in Kind values for the comparison vehicles are only estimates based on certain assumptions, including list price, vehicle excise duty, First Registration Tax, CO2 g/km and income tax rate.
Income tax rates in 2019-20:
• Income up to £12,500 - 0% income tax. This is your personal tax-free allowance.
• Income between £12,501 and £50,000 - 20% income tax.
• Income between £50,001 and £150,000 - 40% income tax.
• Income above £150,001 - 45% income tax.
In addition, the UK government is complying with its Ban Hybrid and Petrol Cars by 2035 plan and provides others tax incentives to all EV.
The UK govt also dropped the “Premium Road Tax” on EVs. It’s an annual tax for cars with list prices over £40k. That saves me £320 a year now. ICE cars still have to pay Road Tax...— Zog-Fot-Pik (@Zog_Fot_Pik) March 12, 2020
i hope they bring the help to buy incentive to England too, i was reading about it and it would seriously help people make the transition to EV who are not as financially stable— Karl Johnson Gaming (@karljohnson2886) March 12, 2020
For residents of the UK, 2020 is becoming very favorable for the acquisition of an electric vehicle, as this year they can count on the supposedly highest tax benefits.
This policy may lead to great demand for Tesla cars in the country market. This will also be facilitated by the fact that legacy automakers have failed to launch competent competitors for Tesla.
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About the Author
Eva Fox joined Tesmanian in 2019 to cover breaking news as an automotive journalist. The main topics that she covers are clean energy and electric vehicles. As a journalist, Eva is specialized in Tesla and topics related to the work and development of the company.