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Tax incentives for Self employed buying EVs

  • 30-09-2020 8:10pm
    #1
    Registered Users Posts: 5,819 ✭✭✭ the_amazing_raisin


    Okay, this could probably go in the taxation forum, but I'm wondering if anyone here has knowledge of this topic

    I've seen that employees are able to claim a reduction in BIK for taxation when using an EV as a company vehicle.

    Basically they can reduce the value of the car for BIK by €50k, so if the car costs less than €50k there's no tax impact, and the impact is significantly reduced for cars over that amount.

    I'm wondering is there a similar incentive out there for the self employed? There's a lot of sole traders out there driving vans for example and with longer range electric vans becoming available it'd be interesting to see if there's much uptake


Comments

  • Registered Users Posts: 2,698 ✭✭✭ graememk


    Okay, this could probably go in the taxation forum, but I'm wondering if anyone here has knowledge of this topic

    I've seen that employees are able to claim a reduction in BIK for taxation when using an EV as a company vehicle.

    Basically they can reduce the value of the car for BIK by €50k, so if the car costs less than €50k there's no tax impact, and the impact is significantly reduced for cars over that amount.

    I'm wondering is there a similar incentive out there for the self employed? There's a lot of sole traders out there driving vans for example and with longer range electric vans becoming available it'd be interesting to see if there's much uptake

    If your self employed there is no benefit in kind tax.

    I don't think there is BIK on a company van either as its a commercial vehicle and not a car.


  • Registered Users Posts: 19,022 ✭✭✭✭ Water John


    In the past if you owned a company you could purchase an EV for personal use via the company, that's gone. You can still claim 100% of the operating expenses as business cost, service, tyres, insurance and electricity.


  • Registered Users Posts: 5,819 ✭✭✭ the_amazing_raisin


    Water John wrote: »
    In the past if you owned a company you could purchase an EV for personal use via the company, that's gone. You can still claim 100% of the operating expenses as business cost, service, tyres, insurance and electricity.

    I think you can claim the lease/finance costs as allowed expenses too


  • Registered Users Posts: 708 ✭✭✭ 3d4life


    I think companies can still claim ACA

    Maybe this also applies to self employed ? ( would suggest asking 'your' accountant )


  • Registered Users Posts: 5,819 ✭✭✭ the_amazing_raisin


    3d4life wrote: »
    I think companies can still claim ACA

    Maybe this also applies to self employed ? ( would suggest asking 'your' accountant )

    Oh I'm not self employed, just asking out of curiosity. Don't think I could take the stress of running a business


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  • Registered Users Posts: 27,467 ✭✭✭✭ drunkmonkey


    Water John wrote: »
    In the past if you owned a company you could purchase an EV for personal use via the company, that's gone. You can still claim 100% of the operating expenses as business cost, service, tyres, insurance and electricity.

    It's not gone....

    2019 to 2022 Extension of Exemption
    You may choose to make an electric car available to your employee for private use between now and 31 December 2020.

    Where this occurs, no charge to BIK arises in respect of any use by your employee where either of the following apply:

    the OMV of the car is €50,000 or less
    or
    you first made this car available to your employee between 10 October 2017 and 9 October 2018.
    Where neither of the above apply, only a partial exemption is available. This is granted by reducing the OMV by €50,000 when calculating the cash equivalent for the car.


  • Registered Users Posts: 19,022 ✭✭✭✭ Water John


    Thanks for that, monkey.


  • Registered Users Posts: 27,467 ✭✭✭✭ drunkmonkey


    You can also claim back 20% of the vat if it's being used for 60% or more business purposes.


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