in association with
FUNDAMENTALS OF \ EV MOBILITY
Amid growing pressure to drive down CO₂ emissions, what support is available to help fleets develop an operationally and cost-effective electric vehicle strategy?
in association with
Fleets have an ever-improving business case for going electric. Battery packs are 84% cheaper (per-kWh) than they were in 2014, according to Bloomberg NEF, while supply chains are maturing, delivering a more affordable, more versatile, more varied choice of electric cars and vans.
The SMMT says 135 battery-electric cars and more than 100 different plug-in hybrids were available in the UK in May 2025, ranging from city cars to luxury saloons and SUVs, and LCV options are improving too. Selecting the right vehicles and deploying them effectively is critical for controlling total operating costs (TCO) – here’s how.
COMPANY CAR TAX
HMRC assigns a taxable value to cars that are available for private journeys – a percentage of the list price, weighted against vehicles with higher CO₂ emissions. Employees then pay Benefit-in-Kind on that figure at the same rate as their income tax band (typically 20% or 40%) while employers’ National Insurance Contributions are charged at a flat 15%.
This system provides generous tax breaks for ultra-low emission vehicles (ULEVs) – a term encompassing all BEVs and PHEVs emitting 50g/km CO₂ or less (at the tailpipe). It’s created a market where 80% of ULEVs are registered to fleets, and incentives are in place until at least April 2030:
● BEVs (0g/km) are taxed at 3% of the list price (2025/26), rising 1% point in April 2026 and 2027, then 2% points in 2028 and 2029 – to 9%. Although it’s a three-fold increase, it’s less than half the next-lowest band. This includes FCEVs.
● PHEVs (1-50g/km) fall into five bands, from 3% to 15%, according to their electric range. They also get a 1%-point rise in April 2026 and 2027, before being combined into a single 18% band in 2028, rising to 19% in 2029.
Incoming changes to PHEV tax from April 2028 coincide with the Euro 6e-bis emissions standard being implemented in the UK. Already in force across the rest of Europe, this reduces the influence of a PHEV’s electric range on its published efficiency and CO₂ figures and could push some models over the 50g/km CO₂ ULEV threshold.
CONSIDERATIONS FOR VANS
Demand for electric light-commercial vehicles (LCVs – which includes vans and pickups) is slower than it is for cars, and behind the 16% ZEV mandate target for 2025. The SMMT says only 8.8% of new registrations year to date (July 2025) are electric, held back by higher prices, reduced range and payload compromises.
There are incentives to encourage uptake. Drivers don’t pay Benefit-in-Kind if they use an electric LCV for private journeys, and the gross weight limit of the largest models has been extended to allow for the battery on board. Electric LCVs between 3.5 and 4.25 tonnes are counted towards ZEV mandate LCV targets and can be driven without additional training, but they are still technically a heavy-duty vehicle. They require an earlier first MOT and, for some operators, compliance with drivers’ hours rules and an electronic speed limiter which an equivalent payload diesel van would avoid.
PURCHASE INCENTIVES
Businesses purchasing electric vehicles can claim grant funding of up to £3,750 for cars (depending on where they were manufactured) and £5,000 for LCVs (according to gross weight). They can also deduct 100% of the investment cost from their pre-tax profits, falling to 18% for cars emitting between 1-50g/km CO₂ and 6% for models above that threshold.
Leased assets also qualify for tax relief. Businesses can deduct 100% of the monthly rental cost for cars emitting 50g/km or less, compared to 85% if they are above that CO₂ threshold. The 100% rate isn’t CO₂-capped for most LCVs, but double-cab pickups are now treated as cars for corporation tax purposes which incentivises the most efficient models.
CHARGING COSTS
Operating costs for PHEV and BEV cars and vans vary significantly, depending on where they are charged. Zapmap reports an average price of 76p per kilowatt-hour (kWh) for the fastest public chargers, compared to 27p on a flat-rate, Ofgem-capped home tariff. Providing cheap, convenient charging is essential for controlling costs, and that includes PHEVs where the alternative is drivers not plugging them in at all.
The Government offers up to 75% (capped at £350) towards chargers and installation at workplaces and homes, including flats and on-street parking spaces but excluding homeowners in single-occupancy houses. Businesses can claim grants for up to 40 workplace sockets and deduct 100% of the cost from their pre-tax profits, while the cost of installing home chargers and energy provided at work are Benefit-in-Kind exempt.
“Fleets have an ever-improving business case for going electric – battery packs are now 84% cheaper than in 2014, with a broader, more versatile choice of cars and vans than ever before.”
“
Switching to electric doesn’t have to be complicated. Holman’s Electric Vehicle Services provide complete, end-to-end support to guide your fleet through every stage of the EV journey.
From initial planning to vehicle resale, we guide you through every stage of the EV lifecycle. Once your fleet is on the road, our 24/7 maintenance and repair support keeps everything running smoothly.
When it’s time to cycle out vehicles, we help maximise your return with EV-specific resale expertise and valuations.
Backed by seamless data integration and real-time visibility, Holman’s EV solutions help you make smarter decisions at every turn – improving performance, reducing costs, and supporting your sustainability goals.
Whether you’re just beginning or ready to scale, Holman brings clarity and confidence to your electric future.
If you’re looking to understand how these changes might impact your fleet, or want help building a practical, forward-looking EV strategy – we’re here to help.
