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Looking for some advice here...
OH runs a small company that needs a car for work related stuff. Currently she's using the famliy car but I need to use that to get to work now. We're looking at EV's, but I'm a bit confused about the 100% capital allowance for a new EV vs 18% WDA for a used EV.
What's the reason the hmrc have decided on the 100% rate for new EVs? Is that better for financing or something?
Basically can someone just tell me if it makes more sense to get a 2nd hand Renault Zoe for 7-8k, or a new Dacia Spring for 15k or so... ??
I guess it depends how much corporation tax you pay?
If you have a 15k tax bill then you basically get a free van.
The scheme is their to get more EV's into the market.
That's my understanding, IANAA.
My understanding is the 100% capital allowance, means you can offset 100% of the cars value against profit (taxed at 25%) in the first year. For second hand, it's 18% of cars value per offset against profit per year (for every year of ownership).
There's no free vans I think..
tell me if it makes more sense to get a 2nd hand Renault Zoe for 7-8k
It doesn't, unless you really want a small city runaround. You'd be better off with a Hyundai Ioniq Electric, the 28kWh version is cheaper and as good as the 38, they are proper cars. I can't say anything about the tax situation though.
You’d be better off with a Hyundai Ioniq Electric
only if you want a car that looks like a suppository with all the charisma of a dead crow. Its a technically good car, with all the appeal of doing the dishes
OP : fiat 500es are cheap new - might be an option depending on what the type of business is.
100% first year capital allowance is a cash flow thing. Nothings for free. And when you sell you pay Corp tax on that value.
It's useful though when buying a big ticket item.
ah right I think I've got it figured out. I think 2nd hand makes more sense. fwiw we're looking for a city run around, the smaller the better. She works in childcare / education.
We're not "car people", they're just white goods to us so literally zero interested in charisma and all that nonsense!
only if you want a car that looks like a suppository with all the charisma of a dead crow. Its a technically good car, with all the appeal of doing the dishes
But his first suggestion was a Zoe! I have to admit they're decent but spartan city cars, however there are a lot of rumours of poor reliability.
hmm, what rumours are these? We're looking at one at the weekend.
We were going to go for a small 1l petrol car, but even 10 year old ones in decent condition are still going for 4-5k or more. Needs to be 5 door too so no fiat 500s.
they’re just white goods to us so literally zero interested in charisma and all that nonsense!
You say that but, as with anything, at some point you'll want to sell it and at that point "charisma and all that nonsense" starts to matter.
with Zoe's I think some of them are stuff under a battery lease scheme, so watch out for that (most should be on owned batteries by now)
depending on the range you need, an old nissan leaf can be <£4k, has rear doors, but a realistic range of <50 miles (later ones have more) and slow charging. if its just nipping to the shops, they're fine, and cheap as a result of the limitations
https://www.autotrader.co.uk/car-details/202407021369096
Does this make sense if you're close, or over the VAT threshold? Does the car not accrue VAT if sold once you are? Would either mean you have to effectively drop the price 20% or sell to a trader which I assume is effectively the same thing.*
* Cars may have different VAT rules in business - iinaa.
I think the Zoe now has a zero star NCAP rating partly because it lacks safety features that are now required to get stars - stuff like automatic emergency braking and other bits https://www.drivingelectric.com/renault/zoe/reliability
My Ioniq however has all the safety features you can get, pretty much, along with most things you can think of like ventilated seats. You may view cars as white goods rather than desirable items, but some white goods can do their jobs much better than others. For example, scheduled defrost, heated seats and heated steering wheel as standard....
We were going to go for a small 1l petrol car, but even 10 year old ones in decent condition are still going for 4-5k or more.
That's what we found. She drives 26 miles a day, and even at that low mileage the huge saving on fuel was enough to pay the extra over getting a much older and far more basic small petrol car.
If you want a 5 door 1 litre car. Look at the 2015-2018 twingo super cars, I've had one since 2015 brilliant, reliable and if you get the turbo one 90bhp with f-all weight. Plus no road tax currently...
JeZ
Just been looking at that Zoe rating, wow, it really is terrible. Seems it's not just electronic safety features, it looks structurally bad .... Right scrap that, time to look at Ioniq/Leaf/Golf etc.
Zoe...
https://www.euroncap.com/en/results/renault/zoe/44206
Leaf for comparison..
https://www.euroncap.com/en/results/nissan/leaf/32742
Leafs are decent enough, it's just that I really hated mine, mostly because of the long distance experience. But do get a 40kWh one which is the new shape. Golfs are Golfs but with an electric motor - good, but short range, but this wouldn't matter to you. There's a 28kWh Ioniq which is about as good as the 38 minus a few technical features, but a bit cheaper. They rapid charge faster too. Konas/eNiros are also good but cost more because SUV.
Right scrap that, time to look at Ioniq/Leaf/Golf etc.
Going to throw in the Peugot e208 as another option - I love mine. eCorsa is also an alternative (same car underneath as the e208).