Euan Doig is a freelance automotive journalist with over 22 years of experience in the field.
Euan has been writing lately for What Car?, Classic
Prior to turning to automotive journalism, Euan worked in motorsport journalism, editing and writing for F1 Racing and Autosport, before spending a decade learning his craft at his local newspaper, The Courier.
Company car drivers used to know quite easily what type of engine their next fleet vehicle should have.
There were two possible options: gasoline or diesel, and until a few years ago, diesel was the preferred option due to the low corporate car tax applied to cars that run on this fuel. All of that was replaced as concerns about diesel engine emissions grew.
This leaves fleet managers and drivers with a difficult choice. Should they go back to petrol cars and vans and settle for higher fuel prices and rate tax rates (BIK), or stick with “dirty diesel”?, those are no longer the only options.
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Hybrid cars have been around for a while, and while they still use fossil fuels, they use them more efficiently. Best of all, they emit less CO2 than models with a natural petrol or diesel engine, so the tax costs involved are much lower. . No problem. And again. . .
The targets have been replaced once again, and mild hybrids and self-charging hybrids are now subject to higher taxes. Go ahead with plug-in hybrids (PHEVs), which offer lower taxes because they emit even less CO2 and can make some trips on electric power alone.
Do you still consider the BIK tax on PHEVs to be a bit high?Well, you’ll do better with an electric car. Electric cars (EVs) emit virtually nothing, so currently your BIK tax bill is very low. They do, though, they impose some trade-offs on you in terms of diversity and charging time, so you want to be sure that an EV will suit your life as a fleet driver.
In this advisor on the most productive fuel selection for your next fleet of vehicles, we’ll look at all the features and compare them in terms of load and convenience to help you make an informed selection. You can find many more tips to help you get the most out of your fleet of corporate vehicles, by adding the option for the right model, on our Fleet Vehicles pages.
Read more: The cheapest corporate cars in the UK.
The world of electric vehicle generation is advancing at an alarming rate, making electric cars suitable for more and more people. That’s a smart thing to do, because an electric vehicle is the most tax-efficient fleet option.
Zero-emission cars are taxed at 2% in the 2023-24 tax year, and this rate will remain frozen until the end of the 2024-25 tax year. For example, an electric vehicle will charge much less in BIK tax than a small one. sedan with internal combustion engine.
And of course, everyone has noticed how quickly electric cars can accelerate, so they would let fossil fuel car drivers breathe in their exhaust fumes, if they emitted any at all. Which, of course, is the case.
One thing to keep in mind is that HMRC will increase the tax on electric cars, with the aim of regaining some of the lost source of revenue because other people buy less petrol and diesel. But even then, the rate will rise to just 5% in 2027-2028, so electric cars will still be much less expensive to run.
Benefits · Extremely Low Corporate Auto Tax Rates · Most electric cars can go more than 200 miles with a fee · It makes even more sense if you can qualify at home
Disadvantages · Long waiting lists · Expensive to hire · Not ideal for drivers with a lot of mileage
Read more: Electric corporate cars
Most car brands offer a hybrid powertrain at some point in their range. Some of them are classic hybrids, which recover the power that would be lost when braking to recharge a battery (a procedure called regenerative braking). Normally, they can only travel short distances on electric power. .
Plug-in hybrids (PHEVs) have an advantage for fleet drivers, as they emit less CO2 and are therefore in a lower tax bracket.
The farther they can with electric power, the lower their tax bracket will be, so an effective PHEV with smart diversity can really pay off. We’re starting to see models that can officially go more than 70 miles on electric power alone.
Benefits · Lower tax costs than a natural gasoline or diesel vehicle · A PHEV has an engine, so don’t worry about range · A step on the road to a fully electric vehicle
Disadvantages · An electric vehicle is still less expensive in terms of corporate car tax · Hybrid batteries reduce shipping space on some models · PHEVs need to be recharged for the highest production efficiency
Read more: PHEV corporate cars
Petrol cars have seen a resurgence in popularity following the fall of diesel. However, fleet drivers would be much better off with a PHEV, as natural gasoline cars will emit a lot of CO2 and therefore generate higher BIK tax bills.
Benefits · Don’t worry about autonomy and refueling is simple · Much larger than diesel engines for urban driving · Small turbocharged petrol engines are economical
Disadvantages · A natural gasoline emits more CO2 than a hybrid · Much thirstier than diesels on long journeys · Relatively high BIK CO2 bills
Read more: Corporate SUV cars
The diesel star has been on the decline for a while now, but it’s still an option if you’re a fleet vehicle or pickup truck driver.
Modern diesel cars will need to meet the RDE2 emissions standard, which means they are exceptionally clean. You’ll pay more tax for using a diesel, but if you’re a professional driver who drives maximum mileage, it’s the most productive option. due to the higher numbers of the economy and the enormous diversity of tanks.
Benefits · Diesels that comply with RDE2 the 4% surcharge faced by less efficient diesels · Diesels are cheaper than hybrids on long journeys · A natural gasoline car will emit more CO2
Disadvantages · An electric vehicle or PHEV will charge much less in BIK taxes · Even the cleanest diesel engines are more destructive to air quality than an electric vehicle · Diesel particulate filters can become clogged if the car is only used for short trips
If there’s one thing that’s absolutely clear in this ever-changing world of corporate cars, it’s that the surest way to reduce your taxes is to buy a car with some form of electrification.
PHEVs or EVs are the best options, but you need to make sure that an electric vehicle is compatible with your life. Only a diesel if you drive a lot of miles each year.
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