Latest news with #ElectricCarScheme
Telegraph
13-05-2025
- Automotive
- Telegraph
Workers could pay for heat pumps using salary sacrifice
Homeowners who ditch their gas boilers for a heat pump could pay back the cost of installation through salary sacrifice schemes under plans being considered by Ed Miliband. The proposal would allow salaried employees to repay their loan in monthly instalments that come out of their pre-tax income, saving money overall as they pay less towards national insurance and income tax. It would be similar to salary sacrifice schemes already in place for electric vehicles, which have been credited with boosting uptake among drivers. Mr Miliband, the Energy Secretary, is looking to expand the schemes on offer as a way of helping consumers with the similarly high costs of switching to a heat pump, according to energy companies. According to data provider MCS, the typical cost of installing an air source heat pump – the most common kind – is still about £5,500 after government grants are applied. On Monday, the Government did not rule out making salary sacrifice options available for heat pump purchases but it is understood there are no immediate plans being drawn up. The proposal would likely be more complicated to introduce than the equivalent EV scheme, however, given that heating systems are not typically leased. However, The Electric Car Scheme, which runs salary sacrifice schemes for client companies, said payments on a heat pump costing £14,760, spread over three years, could effectively be reduced from £410 to just £295 using the tax perk. Thom Groot, the chief executive of the company, said: 'We know that the government is seriously considering adding heat pumps to the hugely successful legislation covering salary sacrifice EVs and would welcome their introduction. 'Including these sustainable technologies would provide a meaningful boost to both our net zero goals and the economic growth that Rachel Reeves has made a central pillar of her policy.' Trevor Hutchings, the chief executive of the Renewable Energy Association, added: 'The growing uptake of EVs has been driven in many cases by the hugely successful salary sacrifice provision that makes them cheaper for consumers. 'Extending this to include renewable technologies like heat pumps and solar could provide the industry with a much-needed boost, one that industry estimates could translate into roughly 600,000 Heat Pump and renewable heating installations by 2030.' A government spokesman said: 'We are helping more people install heat pumps, including with our £7,500 grant – and supporting industry to develop financing models that can remove the upfront cost entirely. 'We are consulting on expanding the Boiler Upgrade Scheme to support new approaches, such as heat pump subscriptions, to help more households make the switch to cleaner heating in a way that works for them.'
Telegraph
07-03-2025
- Automotive
- Telegraph
Second-hand Teslas flood the market as Elon Musk faces British backlash
British drivers are offloading Teslas in record numbers amid a political backlash against Elon Musk, the company's chief executive. Figures from Auto Trader showed that 4,822 second-hand Teslas were advertised on the car site in February and 4,639 in January, a significant increase on previous months. The number put up for sale in February was up 36pc from December and up 70pc from the same month last year. It comes as the company faces growing competition among electric car makers. Meanwhile, Mr Musk's closeness to Donald Trump and support for far-Right European parties has divided opinion. The number of second-hand Teslas advertised on Auto Trader has risen steadily over time, as increasing numbers of motorists who acquired new cars several years ago put them up for sale. However, the rise in listings between December and January was the biggest month-on-month increase on record. Second-hand Tesla prices have also fallen heavily as more owners put them on the market. A three-year-old Model 3 cost an average of £20,887 on Auto Trader in February, down 17pc year-on-year. This compares to an 8.2pc fall in like-for-like prices of all electric cars in the year to January. Tesla shares have fallen by more than 30pc this year as it faces falling sales in multiple markets. This week, figures have shown orders falling by 76pc in Germany, 72pc in Australia and 49pc in China. In the UK, sales of new Teslas rose by 21pc in February, although this was an unusually strong month for electric car demand as buyers pushed to avoid a tax rise on new electric vehicles (EVs). The rise was slower than wider EV sales which were up 41.7pc. Thom Groot, of the Electric Car Scheme, which sets up salary sacrifice programmes for companies, said the company had seen interest in Tesla fall as Mr Musk's political pronouncements had grown. However, he said the cars were also less in demand because their perceived technological edge over rivals was shrinking. Mr Groot added that as a proportion of all inquiries, interest in Teslas had roughly halved since November's US election. He said: 'We've definitely seen a big reduction in people interested in Tesla. A couple of years ago, they were very, very popular because they were the most technologically advanced brand. 'But what we've really seen over the last three months is sales dropping and some people looking towards other brands as a direct consequence of Elon Musk being in the news.' A senior figure at another major car-leasing company agreed with this analysis but said it was difficult to tell how much Mr Musk's politics were a factor versus the lack of new Tesla models for several years. 'We have had some people cancelling their orders, explicitly because of Musk's politics,' they said. 'But Teslas have actually been dropping off for the last 12 to 18 months, and a lot of that is just because they're quite old now. 'For the same price, there's now quite a lot of options including BMWs and even a Lexus.'
Yahoo
03-03-2025
- Automotive
- Yahoo
Businesses exploit EV tax trick to beat Reeves's National Insurance raid
Businesses are piling into electric vehicle (EV) salary sacrifice schemes in a bid to beat Rachel Reeves's National Insurance tax raid. Car providers have reported a surge of interest from companies in setting up company car benefits following an announcement by Ms Reeves, the Chancellor, of an increase to employers' National Insurance contributions (NICs). The NICs changes – criticised as a 'jobs tax' by business groups – will raise the levies companies pay on staff wages from 13.8pc to 15pc from April 1. Thom Groot, the chief executive of The Electric Car Scheme, said many firms were now seeking to minimise the blow by signing up employees to EV salary sacrifice schemes. National Insurance is only charged on the total after any salary sacrifice contributions are made. Mr Groot said: 'Pretty much overnight after the Budget, we saw a big uptick in interest. Previously there were a lot of businesses who were looking at it and telling us, 'This is interesting, but I'm really busy.' 'But now the increase in employee National Insurance contributions has sparked a lot of those businesses into action, because they're being challenged on costs and asking, 'How can we drive savings?'' The Electric Car Scheme manages salary sacrifice schemes on behalf of a string of organisations including Holland & Barrett, Hitachi, Time Out, Tuffnells and Millwall Football Club. The schemes see businesses lease electric cars on behalf of their employees, who then receive the vehicles as a benefit and pay for it out of their salaries – before tax is deducted. Mr Groot said a typical monthly salary contribution tends to be around £600, meaning that employers could reduce their NICs by some £90 per employee, per month. If 100 people signed up at a company, that would translate into savings of £108,000 on their annual tax bill. Mr Groot said inquiries to his company jumped by 20pc in the aftermath of the Budget, with car orders rising 22pc. A source at another car leasing provider said they had seen a similar post-Budget jump in interest. The increase comes as ministers are considering whether to relax government EV sales targets, which manufacturers have claimed are too tough. Companies can make 'considerable' NICs savings by offering EV salary sacrifice schemes, according to information published by accountancy giant BDO. However, some of this will be reduced by other changes to benefit-in-kind tax rules that are also coming into force. From April 1, companies must pay a tax on the car equivalent to 3pc of its list price – up from 2pc previously – and this will rise by one extra percentage point per year until April 2028. However, BDO said: 'The overall financial impact achievable from implementation is still positive.' Salary sacrifice schemes have been credited with boosting uptake of EVs in recent years, as many models remain too expensive for drivers to buy upfront. Mr Groot said the schemes gained in popularity following the pandemic because 'people were looking at it as a way to offer a nice benefit for their employees, because it was a very, very competitive recruitment market. Now the emphasis is much more on cost savings'. He added that over time, the profile of workers using the schemes had gradually shifted from being dominated by the highest paid to a broader mix of workers – though higher earners are still disproportionately represented. Across the companies who use The Electric Car Scheme, around 52pc of staff who lease vehicles are basic rate taxpayers versus 48pc on higher rates. (Across the national workforce, 13pc are higher-rate payers.) 'Obviously, the price is still relatively expensive,' Mr Groot added. 'But not everyone goes for a new car. 'What we've seen over the last year is the second hand car market in EVs has become much more active, and we're seeing a lot of take up of second-hand EVs through salary sacrifice.' A typical second-hand EV costs £400 to lease per month through salary sacrifice, he said. The Treasury was approached for comment. Broaden your horizons with award-winning British journalism. Try The Telegraph free for 1 month with unlimited access to our award-winning website, exclusive app, money-saving offers and more. Sign in to access your portfolio
Telegraph
03-03-2025
- Automotive
- Telegraph
Businesses exploit EV tax trick to beat Reeves's National Insurance raid
Businesses are piling into electric vehicle (EV) salary sacrifice schemes in a bid to beat Rachel Reeves's National Insurance tax raid. Car providers have reported a surge of interest from companies in setting up company car benefits following an announcement by Ms Reeves, the Chancellor, of an increase to employers' National Insurance contributions (NICs). The NICs changes – criticised as a 'jobs tax' by business groups – will raise the levies companies pay on staff wages from 13.8pc to 15pc from April 1. Thom Groot, the chief executive of The Electric Car Scheme, said many firms were now seeking to minimise the blow by signing up employees to EV salary sacrifice schemes. National Insurance is only charged on the total after any salary sacrifice contributions are made. Mr Groot said: 'Pretty much overnight after the Budget, we saw a big uptick in interest. Previously there were a lot of businesses who were looking at it and telling us, 'This is interesting, but I'm really busy.' 'But now the increase in employee National Insurance contributions has sparked a lot of those businesses into action, because they're being challenged on costs and asking, 'How can we drive savings?'' The Electric Car Scheme manages salary sacrifice schemes on behalf of a string of organisations including Holland & Barrett, Hitachi, Time Out, Tuffnells and Millwall Football Club. The schemes see businesses lease electric cars on behalf of their employees, who then receive the vehicles as a benefit and pay for it out of their salaries – before tax is deducted. Mr Groot said a typical monthly salary contribution tends to be around £600, meaning that employers could reduce their NICs by some £90 per employee, per month. If 100 people signed up at a company, that would translate into savings of £108,000 on their annual tax bill. Post-Budget jump in interest Mr Groot said inquiries to his company jumped by 20pc in the aftermath of the Budget, with car orders rising 22pc. A source at another car leasing provider said they had seen a similar post-Budget jump in interest. The increase comes as ministers are considering whether to relax government EV sales targets, which manufacturers have claimed are too tough. Companies can make 'considerable' NICs savings by offering EV salary sacrifice schemes, according to information published by accountancy giant BDO. However, some of this will be reduced by other changes to benefit-in-kind tax rules that are also coming into force. From April 1, companies must pay a tax on the car equivalent to 3pc of its list price – up from 2pc previously – and this will rise by one extra percentage point per year until April 2028. However, BDO said: 'The overall financial impact achievable from implementation is still positive.' Salary sacrifice schemes have been credited with boosting uptake of EVs in recent years, as many models remain too expensive for drivers to buy upfront. Mr Groot said the schemes gained in popularity following the pandemic because 'people were looking at it as a way to offer a nice benefit for their employees, because it was a very, very competitive recruitment market. Now the emphasis is much more on cost savings'. He added that over time, the profile of workers using the schemes had gradually shifted from being dominated by the highest paid to a broader mix of workers – though higher earners are still disproportionately represented. Across the companies who use The Electric Car Scheme, around 52pc of staff who lease vehicles are basic rate taxpayers versus 48pc on higher rates. (Across the national workforce, 13pc are higher-rate payers.) 'Obviously, the price is still relatively expensive,' Mr Groot added. 'But not everyone goes for a new car. 'What we've seen over the last year is the second hand car market in EVs has become much more active, and we're seeing a lot of take up of second-hand EVs through salary sacrifice.' A typical second-hand EV costs £400 to lease per month through salary sacrifice, he said. The Treasury was approached for comment.
