Electric Dream

Paula Veysey Smith • 25 June 2018

Tesla – an electric dream or an expensive nightmare?

A client recently asked me to look into the implications of buying an electric company car. There are certainly some very strong incentives to go electric if you are looking to buy a company car including the following:

  • 100% First Year Allowance for business owners to April 2021
  • UK plug in car grant of £4,500
  • Reduced Employer Class 1A national insurance contributions
  • Exemption from London congestion charge
  • Reduced Benefit in Kind (BiK) taxation for company car drivers

Well that is the stuff that dreams are made of, isn’t’ it? Or will this dream turn into a nightmare.

Firstly, though you will be paying reduced Class 1A contributions (2018-19 13% Tesla, 37% combustion engine) you will still have to pay these. The same is true for the BiK. The company car tax payable by an employee is based on the vehicle’s P11D value multiplied by the appropriate BiK rate (determined by the car’s CO2 and fuel type) and the employee’s income tax rate providing significant savings over high CO2 emitting vehicles. Battery electric vehicles offer the lowest BiK rate of any fuel type. A P11D will have to be submitted to the Revenue which may be an additional cost to your company. There will be less to pay than on a conventional combustion car but you will still have to pay further tax and national insurance contributions.

The 100% write down is again a popular incentive but two things to be aware of. Firstly, when you sell the vehicle you may have to repay some of the write down depending on whether a profit was made. Secondly, as a car with dual purpose, ie, both business and personal, you won’t be able to reclaim the VAT although some relief is allowable through the corporation tax on the write down. Finally, these incentives are only available on a new purchase and not on second hand vehicles.

So, dream or nightmare? IF you are convinced that a company car is the way forward, or already have one, then a look at the electric market is well worth it. However, I still believe that the most tax efficient way to manage your business miles is to use a personal car and claim mileage. Furthermore, the rates and incentives are continually changing and the electric car market is relatively new; what seems like the dream like investment now could become that tax nightmare in the future!

If you’d like further information about electric cars please do contact us.

Any questions please do get in touch

R is for Reward

by Paula Veysey-Smith • 8 July 2026
The finish line isn't just a destination. It's proof of everything you put in to get there. “Nothing feels so good as when you've succeeded at something you set out to do.” We made it. Seven letters, seven posts, and one very important journey. If you've been following this series from the beginning, you'll know that back in January we started with a goal — a triathlon in July. And as I write this, sitting in the garden with an iced coffee and a medal around my neck, I can tell you: it happened.  R is for Reward. And it might just be my favourite letter of the lot.

E is for Evaluate

by Paula Veysey-Smith • 8 July 2026
Setting a goal is just the beginning. What keeps it alive — and keeps you moving towards it — is what you do in between. “Evaluating what you're doing is so important. What worked, what didn't, what can I do better?” We're six letters into the SMARTER framework now. We've covered Specific, Measurable, Achievable, Relevant and Time-bound. Today we reach E for Evaluate — and I'll be honest with you, I think this might be the most important letter of the lot.

T is for Time-Bound

by Paula Veysey-Smith • 26 June 2026
A goal without a deadline is just a wish with good intentions. Here's why putting a date on it changes everything. “Having that end date is something that gives you the enthusiasm, the commitment, and the motivation to continue.” We're now on T in the SMARTER Goals series - and this one is beautifully simple. T stands for Time-Bound, or Targets. It means giving your goal an end date.

R is for Relevant

by Paula Veysey-Smith • 26 June 2026
Short-term goals are more powerful when they're built towards something bigger. Here’s why relevance is what keeps you going when motivation dips. “Goals that are shorter term in nature, but built to a bigger vision, are the most motivating that you can get” So far in this series we've looked at S for Specific, M for Measurable, and A for Achievable. Now we come to R for Relevant -- and this one is about making sure your goals are connected to something that genuinely matters to you.
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