Generally, there are company and personal tax efficiencies when buying an electric company car compared to a petrol/diesel car. However, you do need to consider the commercial aspects of your finance plans/funding of the company car in your company, as electric cars are usually more expensive.
Please refer below a comparison between electric and petrol/diesel cars to assist with your decision:
Tax
Electric
Petrol/Diesel
Benefits In Kind
Car
3% (2025/26) 4% (2026/27) of list price based on CO2 emissions
15% – 37% of list price based on CO2 emissions (2024/25 and 2026/27)
Van
0% if zero carbon emissions
A fixed £4,020 (2025/26) and £4,170 for 2026/27.
Employer-provided charging point
At work
There is no benefit for company cars.
N/A – A car fuel benefit applies of £28,200 (2025/26) and £29,200 for 2026/27.
At home
Taxable for employee cars
N/A – A car fuel benefit applies of £2,800 for 2024-25
By charge card
Taxable for employee cars
N/A – A car fuel benefit applies of £27,800 for 2024-25
Capital Allowances
100% First-year allowances
Available for all electric vehicles
For vans or motorcycles only.
Vehicle charging points
100% First year allowance on vehicle charging points
N/A
Allowances
Mileage reimbursements (for company cars)
10p per mile for fully electric company cars
10p – 23p per mile for company cars
Fuel allowances
45p – 25p per mile allowance for employee’s own car
45p – 25p per mile allowance for employee’s own car