Grants, subsidies and incentives for commercial electric fleets
Thinking about going electric? We don’t blame you. Electric vehicles (EVs) are the future of driving and key to a zero-carbon future.
Despite their reputation for being expensive, EVs are becoming increasingly affordable for businesses.
When you consider the total cost of ownership (TCO) – that’s the upfront cost and all running costs such as insurance, fuel, and tax – EVs are often the most cost-effective option for a fleet.
What’s more, there are many grants, subsidies and incentives available to help boost your budget.
We update this list every few months to make sure you’ve got the guidance at your fingertips.
Grants for electric vehicles
The plug-in car grant was dropped in June 2022 as government funding was shifted to focus on charging and other vehicles. The following vehicle grants remain active:
Plug-in small van grant
35% of the purchase price, up to £2,500 (only available for a total of 1500 plug-in van and trucks for your business or organisation each financial year).
Plug-in large van grant
35% of the purchase price, up to £5,000 (only available for a total of 1500 plug-in van and trucks for your business or organisation each financial year).
Grants are also available for the following vehicle types:
- Wheelchair accessible vehicles
- Small trucks
- Large trucks
Here's a list of all eligible vehicles and criteria for the plug-in vehicle grants.
Grants for EV charge points
EV chargepoint grant
In April 2023 the EV Homecharge Scheme (EVHS) was replaced by the EV chargepoint grant. The EV chargepoint grant provides funding of up to 75% towards the cost of installing EV smart chargepoints at domestic properties across the UK and is split across several schemes:
- EV chargepoint grant for flat owner-occupiers and people leaving in rented properties
- EV chargepoint grant for landlords
- EV infrastructure grant for residential car parks
- EV infrastructure grant for staff and fleets
The EV infrastructure grant for staff and fleets is eligible for companies with 249 employees or less looking for help with the cost of installing infrastructure for EV chargepoints used exclusively by staff or fleet vehicles. This grant may also be used in conjunction with the Workplace Charging Scheme (below).
Guidance for each scheme can be found on the Government website.
The closing date for applications is 31 March 2024.
Workplace Charging Scheme
Up to £350 per socket (40 sockets max) off the cost of a charge point and installation. Maximum possible grant of £14,000.
Grant scheme eligibility and guidance can also be found on the Government website.
Lower Benefit-in-Kind tax - cars
EV company car drivers pay less Benefit-in-Kind (BiK) tax (also known as Company Car Tax (CCT) rates). These will be 2% for 2022/23, 2023/24,2024/25, before gradually increasing to 3% in 2025/26, 4% in 2026/27, and 5% in 2027/28.
0% Vehicle Excise Duty (VED)
Until 2025, pay no VED (otherwise known as road tax) for EVs. This includes EVs which cost more than £40,000.
From April 2025, electric cars, vans and motorcycles will begin to pay VED in the same way as petrol and diesel vehicles.
Find out more about vehicle tax rates.
Reduced Van Benefit Charge
Since April 2021, a nil rate has been applied to zero-emission vans within Van Benefit Charge.
Electric vehicles may also enable you to take advantage of other benefits, including:
- Exemption from fees in the London Ultra Low Emission Zone which was recently expanded across all London Boroughs and Clean Air Zones in other cities
- London-based businesses (under 50 employees) and registered charities can apply to scrap or retrofit up to 3 vans or minibuses and get an increased grant payment as part of the Mayor of London’s £160 million scrappage scheme.
- Free parking in certain locations
- Potentially reduced running costs due to electricity typically being cheaper than petrol or diesel as Fuel Duty is not applied
- Tax exemptions for workplace EV charging under certain conditions
At Drax, we can support you in finding out what grants, subsidies and incentives are available for your business fleet. Get in touch using our contact form.Contact us