There are lots of reasons why drivers choose to an electric vehicle. Some are inspired by the need to save the plant and are ecologically minded. Green motoring is their big incentive. Yet, financial savings are probably the biggest motivation to driving an EV, PHEV or BEV. Even for ecofriendly motorists, the bonus of saving money makes going electric a very enticing option. In these tough times, we are all more budget conscious and there are a number of grants and incentives available for those who change to E.V. driving. These include government grants and other enticements that add to the joy of driving a rechargeable car. Here at Peter Hanley Motors, we can give you the run down on all the positives of driving electric, including the financial savings, if you want to give us a call or drop in.
We also list below an update on the grants and financial enticements available for choosing to drive green.
Yes, motor tax is cheaper for those driving electric. Road tax on an electric car is the lowest rate available. It currently costs €120 a year to tax a fully electric vehicle, while a Plug-in hybrid electric vehicle (PHEV) registered between 2008 and 2021, costs €170 annually. A PHEV that has been registered from 1 January 2021 onwards, will pay car tax at €140 per annum. A quick comparison with petrol and diesel vehicles, will show this to be a considerable saving, especially if you have been driving a car with high carbon emissions.
Not many drivers realise that they can save on toll costs when driving an EV, a BEV, or a PHEV. The Low Emissions Vehicle Toll Incentive (LEVTI) is set to run until the end of June 2023, and you can check the scheme here for reduced toll rates with a participating scheme tag providers who will issue an electronic toll tag. The discounts are good although it’s capped at €500 per year for private vehicles, and €1,000 for commercial vehicles.
Vehicle Registration Tax (VRT) is paid on imported vehicle when they are first registered in the Irish State. This is greatly reduced on imported electric vehicles with relief of up to €5,000 available in a scheme that will last till the end of 2023. Different levels of Vehicle Registration Tax (VRT) reductions apply to different vehicle types and you can check out the rates here.
It is always useful to shop around for insurance and this is especially true for EV and PHEV motorists. Irish Insurance companies started offering more competitive car insurance rates for drivers of hybrid and electric cars a few years ago. Browse the insurance sites for a quote that will reward you for driving electric.
For income tax purposes, Benefits in Kind are non-cash benefits of monetary value that are provided through your employment. It refers to company cars and other items considered to be perks. These benefits are calculated as notional pay and allocated a money value which is then used to calculate your tax liability. The tax man is ready to take back but the BIK system for car calculations moved to a CO2 based system in 1 January 2023. This was to encourage the use of electric vehicles and lower emission cars. Electric vehicles that are provided by companies to their staff and directors are now treated differently. Until the 31st December 2023, new rules apply and a total relief for 2023 will be €45,000. A €10,000 relief has introduced on the Original Market Value (OMV) of some vehicles. The OMV forms the bases upon which the tax is calculated. It will apply to cars in the A - D categories of tax, but not to those in category E, with emissions of 180g/km or more. “For electric vehicles, the OMV deduction of €10,000 will be in addition to the existing relief of €35,000 that is currently available for EVs, meaning that the total relief is €45,000.” It sounds complicated, and here at Peter Hanley’s, we will be happy to talk it through with you, but the bottom line is that there is still a huge incentive to go electric with company vehicles and avail of the preferential BIK.
The Accelerated Capital Allowance (ACA) is a tax incentive scheme designed to promote investment in energy efficient products & equipment. This means that farmers and sole traders can claim 100% ACA for investment in electric vehicles and chargers. Unfortunately, it no longer includes plug in hybrids but does cover fully electric vehicles. To avail of the allowance, you simple note in in normal self-assessment tax returns and there is no need for prior approval. For vehicles, the accelerated allowance is based on the lower of the actual cost of the vehicle or €24,000, whichever is appropriate and you can claim 100%. Get more information here.
There is no doubt that having a home charger is a game changer for owners of plug-in battery powered cars. The grants on offer from the Irish government means you can claim up to €600 toward the purchase and installation of a home charger. The clock is ticking on this grant as the focus will move towards installing public EV chargers soon and the Government has indicated that this is where the money will be funnelled in the future. So now is a good time to get your home charger installed. Certain criteria applies but the grant is open to homeowners whether they own an electric vehicle or not. More information here.
There is grant assistance for the purchase of the vehicle itself. The maximum grant of €5,000 is applies to qualifying new M1 (passenger cars) and battery electric vehicles (BEVs) when purchased privately. To avail of the grant, the purchase price must be less than €60,000 and more than €14,000. The full price of the vehicle can include all optional extras, paint, delivery and any other charges, but excludes any incentives such as other grants or rebates. For a really good view of what you can save in both emissions and other costs on grant eligible cars see this link.
There are great incentives for commercial customers who choose to go electric. The maximum allowance for a new BEV is €3,800 can be claimed and this applies only to commercial vehicles that cost more than €14,000 and less than €60,000 and is dependant on the vehicle you choose. Large panel vans recently were added with a grant of €7,600, provided the van is listed at a price of €90,000 or less. Come in and chat to us if you are considering moving to an electric company fleet and we can go through the pros and cons. More information can be found here.
Since 2018, almost 1500 taxi, hackney and luxury car drivers have accessed the SPSVs grant (small public vehicle grant) for a grant of up to €20,000 for the purchase of a new electric vehicle. The grant can be doubled if a conventional fuel vehicle is scrapped as part of the deal. For more information see here.
The clock is definitely ticking on some, if not all of the incentives and grants available for electric driving. There will always be savings made on the running costs of EV cars, but the extra financial encouragements that are on offer at the moment will sweeten any deal.