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Discussion Starter #1
To get through their busiest time of their year before getting back to me on this...
I wondered whether anyone here has experience of purchasing a used ev through their Ltd company? I understand the BIK rules around list price when new, but I'm not entirely sure about wda percentages.
Essentially trying to work out if it's more cost effective to spend about 35k on a used ev through business or personally.
Have explored leases and new vehicles, none quite work for my needs or offer a significant improvements on my 2017 ioniq ev.
 

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Writing down allowances are 100% when new and 18% when used. It all depends on your income level, business use as to whether business or private ownership works best.

BIK rates are the same for new and used electric vehicles, which should be 0% from April unless the changes aren't legislated. Then it'll be 2%. But it is based on list price not value. A moot point if the 0% is enacted.
 

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I meant to say, if you're spending £35K on a used one, I'd be surprised if a (similar) new one on lease isn't cheaper when you factor in everything? Obviously you have to want what's available.
 

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Discussion Starter #6
I meant to say, if you're spending £35K on a used one, I'd be surprised if a (similar) new one on lease isn't cheaper when you factor in everything? Obviously you have to want what's available.
Yes that's what I'm wondering but haven't yet found the perfect solution.
I need a car (one car family) that can take 3 kids and still has enough space for a few camping trips a year.
Currently have an ioniq which clearly isn't big enough. Tried a model 3 with the thought of adding a tow hitch but inside it just feels smaller (in the back at least) than my Ioniq.
I go round and round but it keeps coming back to a pre face-lift model s...
Any other bright ideas anyone?
 

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Did you see Bjorn's video with the hitch mount roofbox? Quite interesting. But presumably it's the passenger space in the Model 3 that's an issue?
 

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Discussion Starter #9
Did you see Bjorn's video with the hitch mount roofbox? Quite interesting. But presumably it's the passenger space in the Model 3 that's an issue?
I did, it was great! In fact that's why I went for a test drive. Kids loved it but my eldest was very squashed in the middle, more so than in Ioniq. I think it could be to do with the more sculpted nature of the rear seats.
Such a shame is it ticks every other box.
So current front runners remain used model s, or a 2 year lease on an e-tron for £388 plus vat a month...
 

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BIK rate for pure EVs is finally falling to 0% for this year then rising to just 2%. So the incentive for buying or leasing an EV through a business has massively increased. You'll also generally pay 10% VAT if leasing through business vs 20% for a personal lease.

But you miss out on the 45ppm expense claim. I toyed with the idea of business lease for a while, and in my circumstances as a contractor it would now work out significanrly cheaper to lease through business since the BIK cut. The reason I decided against it is that I'm open to possibly taking an employed job again in future, in which case I'd have to fully pay off the business lease and give the car back - not worth the risk. But if you're a conventional business owner, or a contractor who never envisages going perm, I'd say definitely get the car through the business.
 

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Writing down allowances are 100% when new and 18% when used. It all depends on your income level, business use as to whether business or private ownership works best.
Note that "New" also covers cars that have only been used as dealer demonstrators
From CA23153 - Capital Allowances Manual - HMRC internal manual - GOV.UK
New cars are ‘unused and not second hand’. You should accept a car is unused and not second hand even if it has been driven a limited number of miles for the purposes of testing, delivery, test driven by a potential purchaser, or used as a demonstration car
 

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To be clear, the 2020 and 2021 BIK rates are in law, the only one that isn't is 2022 at 2% so let's not create any FUD. I am confident it will stick at 2% but am less confident of what will happen after that. Many of us bought expensive ULEVs back in 2012 at 5% BIK and saw it rise to 16%. I bought the Ampera off my company as the high P11D value (before PICG) meant it didn't make sense for my use case at 12%.

With regards to buying a used EV through your company, my suggestion would be to do sooner rather than later. Bizarrely accountants are just waking up to the benefits for people to do just that, so I predicted demand and prices will just continue to rise after April.

The lease vs buy argument is always tricky. As people have said, being able to claim half VAT back on lease is attractive, but some have residuals set low so are expensive. As leases aren't generally available on used, cash purchase or finance are more common. With buying used, IMO the 18% WDA is better than the front loading 100% on new as less (or no) balancing charge and resulting CT on disposal.

Good luck to OP.
 
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Discussion Starter #13 (Edited)
BIK rate for pure EVs is finally falling to 0% for this year then rising to just 2%. So the incentive for buying or leasing an EV through a business has massively increased. You'll also generally pay 10% VAT if leasing through business vs 20% for a personal lease.

But you miss out on the 45ppm expense claim. I toyed with the idea of business lease for a while, and in my circumstances as a contractor it would now work out significanrly cheaper to lease through business since the BIK cut. The reason I decided against it is that I'm open to possibly taking an employed job again in future, in which case I'd have to fully pay off the business lease and give the car back - not worth the risk. But if you're a conventional business owner, or a contractor who never envisages going perm, I'd say definitely get the car through the business.
Yes, this had crossed my mind too. I wondered if that's another advantage of purchasing used (rather than a new lease). If your circumstances change, you could potentially purchase the vehicle from your ltd company and it come a personal car rather than a company car.
 

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To be clear, the 2020 and 2021 BIK rates are in law, the only one that isn't is 2022 at 2% so let's not create any FUD. I am confident it will stick at 2% but am less confident of what will happen after that. Many of us bought expensive ULEVs back in 2012 at 5% BIK and saw it rise to 16%. I bought the Ampera off my company as the high P11D value (before PICG) meant it didn't make sense for my use case at 12%.


Good luck to OP.
The 2020 and 2021 0%/1% are not law yet. The Finance Act hasn't been passed. Hopefully this won't be derailed in the Budget... Currently the 2020 rate is 2% if nothing changes.
 

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The 2020 and 2021 0%/1% are not law yet. The Finance Act hasn't been passed. Hopefully this won't be derailed in the Budget... Currently the 2020 rate is 2% if nothing changes.
This was a surprise that I only became aware of having received my tax code for the 20/21 year, which was pretty annoying.

Mine is showing 16% rate for 20/21 - when I phoned HMRC they said they don't have any instruction for 20/21. How do you know the 20/21 rate is 2%, if there is nothing in the March budget?
 

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The 2020 and 2021 0%/1% are not law yet. The Finance Act hasn't been passed. Hopefully this won't be derailed in the Budget... Currently the 2020 rate is 2% if nothing changes.
Ah, my bad I thought it had ? I guess delayed due to B word? I can't see them reneging on it though as too many people made large financial commitments. 2% was always good, but the zero tipped a lot of people.
 

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This was a surprise that I only became aware of having received my tax code for the 20/21 year, which was pretty annoying.

Mine is showing 16% rate for 20/21 - when I phoned HMRC they said they don't have any instruction for 20/21. How do you know the 20/21 rate is 2%, if there is nothing in the March budget?
You are not only person getting "wrong" code

 

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