BIK on EVs.

drunkmonkey · 17-02-2021 9:38am

Doh on me! The bik rate has to be based on some value in those charts.
This is a big step backwards.

cubix · 17-02-2021 9:55am

Be interested how they work out what Co2 an EV produces, so either way as and from Jan 2023 EV's will incur BIK

Zenith74 · 17-02-2021 9:56am

drunkmonkey wrote: »

Doh on me! The bik rate has to be based on some value in those charts.
This is a big step backwards.

Yeah it’s a real shame. Essentially the BIK incentive is ending from 2023 onwards. There’s a small benefit to fully electric over petrol/diesel, especially for high mileage users, but the ‘no brainier’ 0% incentive is gone.

Unless they extend it closer to the time, which of course could easily happen.

boccy23 · 17-02-2021 10:10am

Reading the KPMG, the basic of it is that it is going to be much more expensive to have a Company Car after 2023 no matter which way you cut it. The increases for EV or ICE are significant. For those not doing the mileage to necessitate a company car, this may make it something to look long and hard at the so called benefit.

Zenith74 · 17-02-2021 10:22am

cubix wrote: »

Be interested how they work out what Co2 an EV produces, so either way as and from Jan 2023 EV's will incur BIK

EVs are considered to emit 0g/km for tax purposes and so are in the 0-59k/km category.

drunkmonkey · 17-02-2021 10:23am

In my case I'd just swap back to a private car and go back to claiming expensives, it's my first company car since I bought a van years ago starting off. That won't be an option for a lot of company car drivers if the business is supplying the car so I can see them picking the 30k diesel over the 50k EV.

Zenith74 · 17-02-2021 10:46am

I don't know if Revenue have a way of telling how many people have availed of the 0% BIK scheme to determine it's effectiveness, do you have to declare to them an employee is actually using it?

I think it would be worth anybody who makes use of this scheme dropping their local Minister a note asking for the scheme to be extended. In our case we have 5-6 EVs in our company that 100% would have been petrol/diesel cars if not for this incentive, so it's working and the €50k cap has stopped it being just for execs.

jordan191 · 17-02-2021 10:46am

i'd say there will be quite a few people buying back their company EVs in december 2022 & then charging the company mileage

drunkmonkey · 17-02-2021 10:52am

You could see an avalanche of used Tesla's hit the market. I'm planning on a used e hybrid panamera turismo if it happens, can't get planning permission off her indoors at the current prices but they should be in the money come 2023.
I'd buy one now if there was 0% bik.

jordan191 · 17-02-2021 10:55am

just get a trade in valuation off Tesla for example ( nice & low) & buy your tesla from the company, it would be much more tax efficient and totally legit, and claim the mileage tax free

innrain · 17-02-2021 10:56am

So effectively from 2023 BIK for Evs would be 9% - 22.5% of the original price which includes VRT, VAT and before any grants.

Worst case scenario for a 45k car 22.5% is bit over 10k cash equivalent or about 5k tax. In 5 years that is probably what you'd pay to buy the car on your own. I think as employee you'd better negotiate for car allowance as that still lets you claim business mileage

There's a new document regarding claiming VAT

drunkmonkey · 17-02-2021 11:21am

Going on those numbers above it brings Phev's into the fold, panamera hybrid for example (49 Co2), 120k new cost, 18% bik, cash equivalent €21,600, tax due €10,800.
Company pays all running costs. Am I working that out correctly?

KCross · 17-02-2021 12:10pm

Zenith74 wrote: »

EVs are considered to emit 0g/km for tax purposes and so are in the 0-59k/km category.

I never understood why they put EV's in the same CO2 bracket as hybrids for motor tax and now this new BIK scheme as well.

Surely there is a case for having a 0g CO2 bracket and then a 1-59g to cover the PHEV's and hybrids and then ICE above that.

If the policy is to encourage EV's they should have them in a tax band of their own.

The 2023 BIK scheme does seem to be at odds with their plan to get 1m EV's on the road by 2030 as company cars are a significant part of that. Most cars by then will be falling into the A(BEV and PHEV) and B(PHEV and hybrid) categories and there is only 2-4% difference there depending on mileage.... no incentive really.

It could all change between now and 2023 as well when they see what the uptake is. They might see the error of their ways!

Busman Paddy Lasty · 17-02-2021 1:06pm

KCross wrote: »

I never understood why they put EV's in the same CO2 bracket as hybrids for motor tax and now this new BIK scheme as well.

Surely there is a case for having a 0g CO2 bracket and then a 1-59g to cover the PHEV's and hybrids and then ICE above that.

If the policy is to encourage EV's they should have them in a tax band of their own.

The 2023 BIK scheme does seem to be at odds with their plan to get 1m EV's on the road by 2030 as company cars are a significant part of that. Most cars by then will be falling into the A(BEV and PHEV) and B(PHEV and hybrid) categories and there is only 2-4% difference there depending on mileage.... no incentive really.

It could all change between now and 2023 as well when they see what the uptake is. They might see the error of their ways!

It's all over the place. We cancelled an order for six EVs back in October 2019. Prior to that budget also planned to buy 12 more in 2020, pre Covid plan. All because the grant was pulled.

Nobody seems to be in charge. Minister for Finance/Revenue not on the same page as environment minister/ climate action plan.

innrain · 17-02-2021 1:10pm

So this is BIK from 2023

Where A is EV up to 59g/km CO2
While this is now

So basically at 35k km per year you will be as any car now, @40k+2 will be more expensive as now. It seems a move to disincentivize private use of company cars.

rocketspocket · 17-02-2021 3:23pm

innrain wrote: »

So this is BIK from 2023

Where A is EV up to 59g/km CO2
While this is now

So basically at 35k km per year you will be as any car now, @40k+2 will be more expensive as now. It seems a move to disincentivize private use of company cars.

There will be a lot of 2nd hand EVs coming to market in Dec 22 if this goes through..

wassie · 17-02-2021 5:25pm

I would expect changes to keep incentivising business to make the change, although not as generous as what it currently is. There are 2 budgets between now and 2023 and Ireland is still a long way behind meeting our 2030 emissions targets.

20-02-2021 7:35pm

Do many plug in hybrids make it into category A?

innrain · 20-02-2021 8:43pm

I'd say so
A is up to 59gCO2/km inclusive
B is >59 <=99
C >99 <=139
D >139 <=179
E >179
https://www.seai.ie/grants/electric-vehicle-grants/grant-eligible-cars/
You have a list of cars qualifying for private grant. Each has the CO2 listed.

Fawk Nin · 03-03-2021 5:45pm

Apologies for the very basic question but I am still trying to get my head around this incentive. I am currently working as an independent contractor and as such, I am an employee of a company that I have set up.

Would this BIK incentive allow me to purchase a Kia e-Niro (OMV €41k) directly through the company without paying any tax on it?

Are there any other complications to consider?

Thanks.

Zenith74 · 03-03-2021 5:53pm

Fawk Nin wrote: »

Apologies for the very basic question but I am still trying to get my head around this incentive. I am currently working as an independent contractor and as such, I am an employee of a company that I have set up.

Would this BIK incentive allow me to purchase a Kia e-Niro (OMV €41k) directly through the company without paying any tax on it?

Are there any other complications to consider?

There seems to be a grey area over when new entrants can use the incentive, the Revenue website says it ended December 2020 and if you contact Revenue they say the same thing. However as per the posts above, we're pretty sure this is a mistake and it is still open until it ends December 2022.

If it's still open, then yes you could buy the eNiro within the company and drive it for business and personal use without being liable for BIK until 2023.

Royale with Cheese · 03-03-2021 5:53pm

jordan191 wrote: »

just get a trade in valuation off Tesla for example ( nice & low) & buy your tesla from the company, it would be much more tax efficient and totally legit, and claim the mileage tax free

That's a great idea. I got a completely derisory offer for my Golf GTI off Tesla when I bought my Model 3 off them, will work out nicely this time round. Was going to see about trading the car in against a private purchase in 2023. Tesla told me this was no problem, they could treat it as two separate transactions and buy the car off me personally while selling the Model 3 to my company. Even if I do end up trading it, it will most likely work out far better to sell it to myself at Tesla's price first. Maybe even try and sell it privately.

wassie · 03-03-2021 6:45pm

Fawk Nin wrote: »

Apologies for the very basic question but I am still trying to get my head around this incentive. I am currently working as an independent contractor and as such, I am an employee of a company that I have set up.

Would this BIK incentive allow me to purchase a Kia e-Niro (OMV €41k) directly through the company without paying any tax on it?

Are there any other complications to consider?

Thanks.

Also remember if you are buying this through your business you will not be eligible for the SEAI €5000 grant.

Fawk Nin · 04-03-2021 9:32am

Thanks for the replies, much appreciated.

wassie · 04-03-2021 10:09am

Should also mention that whilst a business is not eligible for the grant, it can take advantage of the Accelerated Capital Allowance (ACA).

Whilst getting advice from a forum such as this is useful, if you are considering this seriously, as always do not make any decisions until you have consulted an accountant for correct taxation.

boccy23 · 04-03-2021 4:45pm

Surely if Revenue comes after me, I can quote all the advice here.

liamog · 05-03-2021 1:23am

boccy23 wrote: »

Surely if Revenue comes after me, I can quote all the advice here.

So long as the only advice you quote is 'go consult an accountant'

Mc-BigE · 05-03-2021 12:49pm

Royale with Cheese wrote: »

That's a great idea. I got a completely derisory offer for my Golf GTI off Tesla when I bought my Model 3 off them, will work out nicely this time round. Was going to see about trading the car in against a private purchase in 2023. Tesla told me this was no problem, they could treat it as two separate transactions and buy the car off me personally while selling the Model 3 to my company. Even if I do end up trading it, it will most likely work out far better to sell it to myself at Tesla's price first. Maybe even try and sell it privately.

and if the revenue expect company car owners to pay 22.5% BIK when it was 0% there will be some that will get rid of their EV and go back to PHEV/ICE because the incentive is gone. thus dropping the trade-in price even more in Jan 2023.

total lack of forward thinking by the Revenue for EV adoption on ireland by 2030 and also investing in more public charging, why bother if the EV market sinks in 2023

very depressing

05-03-2021 12:54pm

If the uptake hasn't been significant than the overall benefit for society is nothing to negligible. The only benefactors are those driving 0% BIK EVs....... in such a case there's no real point continuing with incentivising EVs as company cars.

liamog · 05-03-2021 1:04pm

Augeo wrote: »

If the uptake hasn't been significant than the overall benefit for society is nothing to negligible. The only benefactors are those driving 0% BIK EVs....... in such a case there's no real point continuing with incentivising EVs as company cars.

The whole point of incentivising EV company cars is to increase the number of EVs in the second hand market when they get replaced. Most company cars get replaced on a regular enough schedule.

BIK on EVs.

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