Electric vehicle incentives for company cars are set to extend beyond 2028

Company car incentives are going to continue for electric vehicles

The UK government announced in the Autumn 2024 budget that company car tax incentives for electric vehicles are set to continue past 2028.

The Chancellor stated that the government are continuing to support the growth of electric vehicles (EVs) in the UK, with other EV announcements including first year rate of Vehicle Excise Duty (VED) increasing to a higher level for plug-in hybrids and ICE vehicles, in comparison to EVs.

Benefit-in-kind (BIK) tax currently stands at 2% for EVs, with the government outlining an increase to 3% in the 2025/26 financial year, with a 1% increase to follow in the subsequent financial years.

Comparaitively, the rate for cars producing 1-50 g/km of CO2, will rise to 18% in the 2028/29 financial year, and to 19% in the 2029/30 financial year. Current rates are sat between 2% and 14% and will rise to between 5% and 17% in the 2027/28 financial year.

The rise in BIK applies to vehicles of all emissions, including the vehicles of the maximum rate, which are set to set an increase to 39% in the 2029/30 financial year.

Vehicle Excise Duty (VED) for EV’s has been set at £10 from April 2025 to the 2029/30 financial year.

It was also announced that over £2bn will be used to support electric vehicle production in the automotive sector.

Applying for Electric Vehicle Finance

With the option of EVs becoming more financially attractive from the recent Autumn Budget, our vehicle management team can assist with your vehicle financial needs, whether that be a fleet or individual business vehicles, our vehicle management team are on hand to provide solutions that work for your business.

If you need further information, email  enquiries@maffinancegroup.co.uk, call 0115 958 6872 or fill in an enquiry form below.