Martin Lewis gives money-saving advice on VED car tax
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Car Leasing firm Arval UK says changes to Benefit in Kind electric car rates have led to a “rapid expansion” in drivers securing models under salary sacrifice schemes. The changes mean drivers can now secure expensive fully-electric models for cheaper monthly prices.
Speaking to Fleet News, Arval consultant Richard Cox said: “The latest, most advanced and environmentally-friendly cars can be offered to employees at extremely attractive monthly rates.
“[This is] supported by more choice in the electric car marketplace which means that there’s an option for every budget and lifestyle need.”
He added: “These schemes provide a range of genuine advantages to employers and employees, with no real downsides or compromises.
“They also, of course, show exactly how rapidly EV adoption can occur in the right conditions.”
Car tax Benefit in Kind rates for electric cars was slashed from 16 percent to zero percent last year in a bid to boost electric car demand
Rates increased to just one percent earlier this year and will rise to just two percent in 2022.
The slash in costs has led to a surge in demand for electric models with Arval reporting a growth of 280 percent.
Arval said the top 15 cars sourced through their funding option have all been electric models.
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Arval said low tax charges has resulted in an increase in employers offering salary sacrifice schemes to non-company car drivers.
This now stands at 53 percent compared to just 39 percent last year.
Earlier this year, Octopus Electric Vehicles said they had recorded a seven-fold increase in business since rates were cut last year.
They have suggested low Benefit in Kind rates were saving most drivers up to 40 percent on monthly leasing payments.
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