Company Car Calculations

Original Post:

A

AS1

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Jan 17, 2024
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  • #1
    I'm trying to calculate the cost of leasing an electric vehicle through my business. The vehicle will be for business and personal use. Am I right in saying that the full cost of the lease can be offset against corporation tax, plus half of the VAT? For example, if a lease is £728 +VAT (at 20%) p/m, would this be calculated as:

    £873.60 Inc. VAT, minus half of the VAT = £800.80, minus corporation tax relief of £152.15 (at 19%) = £648.65.
     
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    LetsTalkFleet

    LetsTalkFleet

    Free Member
    Business Listing
    Feb 26, 2025
    4
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    Manchester, United Kingdom
    www.letstalkfleet.co.uk
  • #4
    AS1 said:
    I'm trying to calculate the cost of leasing an electric vehicle through my business. The vehicle will be for business and personal use. Am I right in saying that the full cost of the lease can be offset against corporation tax, plus half of the VAT? For example, if a lease is £728 +VAT (at 20%) p/m, would this be calculated as:

    £873.60 Inc. VAT, minus half of the VAT = £800.80, minus corporation tax relief of £152.15 (at 19%) = £648.65.
    Click to expand...
    Hi

    This is correct, a few other points of note:

    You can deduct all of the maintenance cost element and recover all the VAT on the maintenance part.

    As its an electric car then there is no corporation tax leasing disallowance so no issue there.

    Benefit in kind tax rates change each year so should be monitored for the expected duration of the lease as they impact driver tax and employers national insurance.

    As of Feb 2025 Plug in Hybrids (PHEV) are getting a lot of attention and subject to a number of changes.
     
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    MyAccountantOnline

    MyAccountantOnline

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    Sep 24, 2008
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  • #5
    The OP asked over a year ago I'm not sure a reply now to that post is of much help.
     
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    JEREMY HAWKE

    JEREMY HAWKE

    Business Member
    • Business Listing
    Mar 4, 2008
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    EXETER DEVON
    www.jeremyhawkecourier.co.uk
  • #7
    MyAccountantOnline said:
    The OP asked over a year ago I'm not sure a reply now to that post is of much help.
    Click to expand...
    Many a true word is said in jest 🤣

    Some of the main dealer waiting times could mean that it's being delivered this week🤣
     
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