EV grants and tax benefits for businesses

Electric vehicles (EVs) offer businesses significant financial and environmental advantages. From tax incentives to government grants for charging infrastructure, there are substantial opportunities to reduce costs and enhance operational efficiency.

Capital allowance

If your business uses EVs, you can benefit from a special tax allowance called a 100% first-year capital allowance. This allows you to deduct the entire cost of the EV from your profits before you pay tax. This can result in significant tax savings in the first year, making EVs a great choice for company vehicles. By using this tax allowance, you can lower your taxable income and reduce your overall tax bill. This immediate financial benefit encourages businesses to choose EVs, which can lead to big savings and help meet sustainability goals.

Find more information about claiming capital allowances on Gov.uk.

Company car tax

By opting for an EV for your company car you could save thousands of pounds annually on Benefit in Kind (BIK) tax. Up until April 2025, the BIK rate for full EVs was fixed at 2%, with the rate now gradually increasing by 1% each year until 2028. Even with this incremental rise, the tax benefits of driving an electric car will remain substantial, making EVs a financially attractive option for company car drivers looking to minimise their tax burden.

There is a useful explanation about Benefit in Kind Tax regarding EVs on the Santander Consumer Finance website.

Workplace Charging Scheme

This grant provides up to £500 per socket towards the cost of installing chargepoints at workplaces. You can apply for grants for up to 40 sockets across all your sites.

The grant is open to eligible: