How to lease an electric vehicle through your small business

Thinking about leasing electric cars for your small business? Good news: it’s never been easier, and it can even help you save on tax.

There are two ways businesses usually get their hands on EVs: salary sacrifice and business leasing. 

Here’s how each one works, so you can choose what’s best for your business. 

This is where an employee exchanges part of their gross salary for an electric company car. 

Salary sacrifice makes running an EV simpler and more predictable, because most costs are bundled into one monthly payment. 

There’s no minimum number of employees needed for our EV salary sacrifice scheme. Even if you only have one eligible team member, you can still set up the scheme and let them benefit from tax and running cost savings.

The main thing is that the employee must be on your payroll, and it helps if you have a clear process for handling salary deductions. Beyond that, small businesses can get started just as easily as larger ones.

The benefits include:

• Tax savings: Employees pay out of their pre-tax salary, which reduces their Income Tax and National Insurance. 
• Low company car tax: EVs have much lower Benefit-in-Kind (BiK) rates than petrol or diesel cars, and they’re staying that way for at least the next few years.
• All-inclusive costs: Insurance, servicing, and maintenance are all bundled into one monthly payment.
• No upfront costs: By paying monthly, you get to avoid one of the biggest barriers to EV ownership, which is the price tag. 
• Cheaper running costs: Employees get either a free home charger installed or £600 worth of Electroverse credit.
• Exclusive discounts: Salary sacrifice drivers get access to a lower rate on our EV Saver tariff, paying just 8p/kWh instead of 9p/kWh.

How much you’ll save depends on things like your salary, tax band, and mileage. If you’re curious, check out our calculator to see if the maths works in your favour.

This is another really popular way for small businesses to lease electric cars. 

Basically, your business leases an EV for 2-4 years, you pay a fixed amount each month, and then you return the car at the end of your contract. 

Think of it like a long-term rental for your business vehicle. It works well for limited companies, sole traders, partnerships, or businesses running a small company car fleet.

The benefits include:

• VAT savings: You can claim back 50% of VAT on lease payments and 100% on maintenance.
• Corporation tax relief: You can usually deduct your monthly lease payments from your business’s taxable profits.
• Low company car tax: Just like for salary sacrifice, you’ll benefit from the lower BiK tax rates attached to EVs. 

Even as rates gradually increase, it’s safe to bet that EVs will stay much more tax-efficient than petrol or diesel vehicles.

Yep! In fact, now’s a great time to take advantage of the grants and schemes available to you through the government. The main ones to check out are:

• EV infrastructure grant: Covers up to 75% of electrical infrastructure costs, up to £15,000 per site, for small and medium-sized businesses preparing to install multiple chargepoints. 
• Workplace Charging Scheme (WCS): Helps businesses install EV chargers for staff or company vehicles, with up to £500 per socket, for up to 40 sockets. 
• Electric Car Grant: Offers discounts of up to £3,750 on new EVs, including via salary sacrifice. 
• Plug-in van and truck grant: Offers discounts up to £2,500 for small vans, £5,000 for large vans, £16,000 for small trucks, and £25,000 for large trucks.

Tip: The latest rules and amounts can change, as well as who’s eligible to apply, so make sure you always check the latest. 

Can I claim mileage on my leased electric car?

Yes. If your business leases your electric car and you charge it at home, you can usually claim back the cost of the electricity used for business trips.

HMRC sets something called an Advisory Fuel Rate (AFR) for electric cars. It’s a simple way to reimburse the cost of energy used when you drive for work.

As of 2026, the advisory rates are:

• 7p per mile if you charge the car at home
• 15p per mile if you charge at public chargers

The government reviews these quarterly, so make sure you check here for the latest rates.

You can claim more if you have evidence that your actual electricity costs are higher, but using the advisory rate keeps things simple and avoids extra tax complications.

There are loads of EVs on the market, and it can be tricky to know which one works best for your business.

Our top tip is to match the car to your day-to-day needs and costs. For example, you might want to consider:

• Daily range needs: How far do you usually drive each day? Smaller range EVs can be fine for urban or commuter duties. For example, the OMODA E5 offers a practical everyday range. If your drivers regularly cover longer distances, models with a bigger range, like the Tesla Model Y, can help reduce the need for frequent stops.
• Charging habits: Drivers who can charge at home or at work will generally get more convenience and lower costs. If you rely on public charging networks, consider EVs with wider fast‑charging support or strong real‑world range, such as the Tesla Model 3 or Volkswagen ID.7, which are popular choices for longer business trips.
• Cost: Think about energy, maintenance, insurance, and tax incentives like lower BiK and First Year Allowance relief. Cars like the MG4 EV can be more cost‑effective overall and still offer solid range and practicality for everyday business use.
• Practicality: Passenger and cargo space matter if your business often carries equipment or people. SUVs and larger hatchbacks, like the Vauxhall Frontera, can be a good fit when load space and flexibility are priorities.

If you’re thinking about cutting your transport costs, now’s a perfect time to switch to EVs.

It only takes a few minutes to join our EV salary sacrifice scheme or get your business set up for leasing.

And if you’ve still got questions, just book a call with us. We’re always happy to help.