A guide to electric car leasing

Leasing an electric car means paying a fixed monthly amount to use it for an agreed number of years and miles, then handing it back. There's no big upfront outlay, and no car to sell at the end. Which means you don’t have to worry about the car depreciating in value, or not having access to the latest tech. 

If you haven't worked out how you'll pay for your next car, you're in good company. Recent YouGov research showed many drivers open to an electric car didn't know how they'd finance it. This guide explains how an electric car lease through personal contract hire (PCH) works, what it includes, and how it compares with buying or personal contract purchase (PCP).

• Leasing is like a long-term rental. You say how many years you want to keep the car, and how many miles you’ll drive each year, pay a fixed amount each month, and hand the car back at the end.
• You'll usually pay an initial amount upfront, made up of a set number of monthly payments, then a lower amount every month after that until the end of your lease.
• Road tax, MOTs and maintenance are sometimes included in a personal lease. Insurance usually isn't, so budget for it separately.
• Leasing suits you if you want a predictable monthly cost and don't want to concern yourself with the car losing value. Buying suits you if you plan to keep the car for a long time or drive an exceptionally high mileage.
• You can lease a used electric car as well as a new one, which you’ll usually pay less for each month.

Electric car leasing is similar to renting a car, but over the long term. You pay a fixed monthly amount to use an electric car for an agreed number of years and miles, then hand it back. The car belongs to the leasing company throughout, and you never take ownership of it.

We offer a type of leasing called personal contract hire, or PCH. That's the formal name for a personal car lease: a rental agreement between you and the leasing company, with no option to buy the car at the end. So if you've been scrolling through leasing sites wondering what all the acronyms mean, now you know.

Five steps, start to finish:

1. Pick the car, the term and your annual mileage. Most leases run for two to four years.
2. Credit check and paperwork. Leasing is a form of finance, so the provider will run a credit check before approving your agreement.
3. Pay the initial amount. This is usually based on a set number of monthly payments, and you’ll pay it upfront. The higher you decide to make this payment, the more it’ll reduce your monthly payments. 
4. Your car’s delivery, then you’ll pay the same amount every month for the rest of the term.
5. Hand the car back at the end, or start a new lease on a different one.

You're agreeing to a maximum number of miles each year, as well as a number of years you want to keep the car for, and it's worth getting this right. Set your mileage limit too low and your monthly payments will be cheaper, but you'll pay for the extra miles at the end. Most providers, including Octopus EV, charge a set amount per mile. On the flip side, set your mileage too high and you're essentially paying for miles you never drive.

Work from what you actually drive now. If you're not sure, look at the mileage on your last two MOT certificates and take the difference. If your circumstances are changing within the next few years, you should also consider whether you’re going to be driving more or less than in previous years. The charge for going over is agreed as a rate per mile at the start, so you can do the maths on exactly what it would cost before you sign anything.

You simply hand the car back. You can take out a new lease on a different car at the same time, or walk away.

The provider will inspect the car against a fair wear and tear standard, which allows for the marks a car picks up from normal use, but not for damage. The BVRLA publishes the industry guide that most providers work to, and it's worth a look before your handback date rather than on the morning of it.

There's usually no option to buy the car at the end of a personal contract hire agreement. That's the main difference between PCH and PCP, which we'll come back to

Yes, though it usually costs money. Ending an agreement early usually means paying an early termination fee, which is set out in your contract before you sign it. Ask what it would be, and check it against how settled your circumstances are.

The practical answer is to pick a term that you’re comfortable with. A four year lease at a lower monthly amount isn't a saving if you need to get out after two.

More than people expect, which is why comparing two leases on the monthly figure alone can be misleading. One might cover servicing and the other might not.

A PCH lease has two parts: an initial amount, then a fixed monthly one. The two trade against each other. Put more in at the start and the monthly figure comes down.

Four things move the monthly amount: the car you pick, how long you keep it, how many miles a year you agree to, and how much you pay upfront. 

Sitting outside the monthly amount are insurance, charging costs, any miles over your limit, and any damage beyond fair wear and tear.

The lease payment is only half the picture. If you're moving from a car you already own, the fair comparison is what you spend on motoring in total each month, not the lease payment against nothing.

Lower running costs are the reason most drivers look at going electric in the first place, particularly as the price of petrol has been so volatile throughout 2026. 63% of drivers named low running costs as something that would influence them to consider an electric car, in recent research from YouGov, ahead of every other factor. Including the environment.

Here's what that looks like in pounds. A full charge at home can cost just £4.32 in a typical EV, compared with £38.74 for the same amount of miles in an equivalent petrol car. What you actually pay depends on your car, your mileage, your home energy tariff and how much charging you do away from home.

A few bills also stop arriving. No petrol. No MOT for the first three years on a new car, under the current rules. And no repair invoice landing at an inconvenient moment, where servicing and maintenance are part of your agreement.

Leasing isn't most people's default. Among drivers open to an electric car in our YouGov research, 37% planned to pay outright and 9% planned to use PCP. Another 14% hadn't decided. So it's worth setting the three side by side properly.

• Want one predictable figure leaving your account each month
• Would rather not tie up a large amount of money in a car
• Like the idea of changing car every few years
• Want to avoid the hassle of advertising, haggling over and selling a car later

• Plan to keep the same car well beyond five years
• Drive high mileage, where a lease limit might work against you
• Want the car as something you own at the end of it

True, and for some drivers that settles it. It's worth being clear about what you're giving up, though, because with a car it isn't quite what it is with a house.

Any car you buy loses value from the day you get it. This is most stark with brand new cars. When you sell it, you get back whatever it's worth then, which is the price you paid minus everything it lost along the way. On a lease, that loss is the leasing company's problem rather than yours. You pay a fixed amount to use the car and the number doesn’t move.

That matters more with electric cars than it used to. Battery technology, ranges and prices are all moving quickly, which makes a car's value three or four years out genuinely hard to predict. Leasing takes that guess-work off your plate.

It's a fair question, and a common one. 45% of adults named battery safety and longevity as a concern about getting an electric car, second to worries about range, in recent YouGov research.

On a three or four year lease, long-term battery condition isn't a risk you carry. The car goes back way before the period people tend to worry about, and manufacturers typically cover the battery under a separate, longer warranty in the meantime - usually 7-8 years. Check the terms for the specific car you're looking at, as they vary.

Yes. Used car leasing works the same way as leasing a new one. You agree how long you’ll keep the car for and how many miles you’ll drive each year, pay a fixed amount each month, and hand the car back at the end. The monthly figure is usually lower.

It's also more popular than people assume. More drivers said they’d be likely to choose a second-hand electric car next time, over a new one, in our recent research with YouGov. That's not surprising when 42% named the price of the car as a concern about going electric.

‘Approved used’ means the car has been through a set of checks before it's offered, rather than simply being a used car with a lower price. What that covers varies between providers, so ask what's been checked, what's included in the monthly amount, and what warranty comes with it.

Used electric car leasing tends to suit drivers who want a lower monthly commitment, a shorter agreement, or a first electric car without the outlay that comes with a brand new one.

• The car’s real-world range. Check it against a normal week of your driving rather than against the longest trip you take once a year. Range is the concern many drivers have when they first make the switch, (53% mentioned it as a concern in our YouGov research) and it's usually a smaller obstacle than it feels from the outside.
• Your real annual mileage, not your optimistic one. Your latest MOT certificates will tell you what you’ve actually driven in previous years.
• The charge per mile if you go over your mileage. Check this before you sign, rather than after.
• The exact specification and colour, confirmed in writing. It’s disappointing to discover a missing feature you were expecting when the car’s on your driveway.
• An insurance quote for that specific car, so you know your real monthly total.
• How long your quote holds. Prices move, and a quote expiring the week you were ready to order is an avoidable annoyance.
• The lead time. Check this works for you logistically against the date your current car has to go.
• Charging at home. Whether you can have a charger installed where you live, what it costs and how long it takes.
• The early termination terms, in writing. In case you need to give the car back early. 
• What fair wear and tear means for your agreement.

And finally… the all important opinions of everyone else who'll use it. Whoever else drives, the boot, the child seats and the dog all get a say. It's usually a household decision, so make it one early.

We offer personal leasing (PCH) on new and approved used electric cars through. Servicing, road tax and MOTs are included in the monthly amount, with tyre protection available as an add-on. Insurance isn't included, as with any personal lease.

There's a charging side to it too, which is often the part that decides things for drivers getting their first electric car. You can add a home charger, which is either free or discounted (depending on the car you choose). And Octopus EV drivers can get access to a discounted home charging tariff from Octopus Energy. Public charging comes with a discount through Electroverse, which covers hundreds of thousands of chargers across the UK and Europe on one account.

Approved used cars sit alongside the new ones, so you can easily compare pricing. And our EV Experts are on hand you can talk to before you commit, which is worth doing if you're weighing up two or three cars and can't tell which suits you and your family.

You choose a car, a term and an annual mileage, then pay an initial amount upfront followed by a fixed monthly amount. The leasing company owns the car and handles road tax. At the end of the term you hand the car back. There's no option to buy it on a personal lease.

It depends on how long you keep the car. Leasing usually costs less each month and far less upfront, but you have nothing to sell at the end. Buying costs more at the start and you carry the loss in value, though it can work out cheaper if you keep the car for many years.

Road tax is included, and servicing, maintenance and MOTs often are. Breakdown cover is frequently included and tyres sometimes are, though these vary by provider. Insurance and electricity are not included in a personal lease, so budget for both separately.

Yes. Used electric car leasing works the same way as new, usually on a shorter term with a lower monthly amount. Approved used cars have been through a set of checks first. Ask what those checks cover, what's included in the monthly payment and what warranty comes with the car.

You pay for the extra miles at a rate agreed when you took out the lease, charged at the end of the agreement. The rate is in your contract from the start, so you can work out the cost in advance. If your driving changes mid-term, tell your provider rather than waiting.

You'll normally pay an initial amount upfront, usually a set number of monthly payments rather than a percentage deposit. Paying more upfront lowers the monthly figure and paying less raises it. Leasing also involves a credit check, as it's a form of finance.

We ran a survey of 2,074 GB adults with YouGov in June 2026, some of the findings are quoted in this article.