If you’re thinking about buying your first electric car, we know it can be daunting.
Aside from getting the best deal, there are some other factors to consider, such as getting your insurance sorted, arranging government grants and thinking about car tax.
Read on to find out the need-to-know information before you plug in and go!
Insurance
Getting insurance for plug-in vehicles is much easier than it used to be, now that insurance providers have caught up with how electric vehicles (EVs) work.
You may find that the industry generally places EVs in a higher insurance group rating than petrol or diesel cars of similar size. This is largely due to the lack of historical data from which insurance companies base their premiums.
There are plenty of specialist insurance providers, however, who will be able to offer a more tailored policy for green vehicles.
However, the most important variable in a car insurance quote of any kind is the driver – insurance companies will consider your risk profile before giving you a quote. The good news is, as an EV driver, you tend to be considered a safer and lower-risk driver, as a result of your eco-conscious decision to drive green.
Electric car tax
Most EV drivers are exempt from the following taxes in the UK:
Fuel duty
Fuel duty isn’t applied to the electricity used by plug-in electric or hydrogen fuel cell car owners.
Vehicle excise duty (VED)
Only zero-emission vehicles are exempt from paying VED for the first year of ownership.
In order to qualify for tax exemption, the electricity must come from an external power source or an electric storage battery that isn’t connected to any source of power while the vehicle is moving.
In the second year, zero-emission vehicles with a list price less than £40,000 will continue to be tax-free. In comparison, petrol and diesel cars that cost less than £40,000 will pay £140 per year, where hybrid vehicle owners pay £130.
All vehicles that were registered after 31st March 2017 and cost over £40,000 will carry an additional fee. This brings the annual payment up to £310 for the second to sixth year of ownership. This cannot be waived regardless of emissions.
The DVLA states that the ‘list price’ is the published price before any discounts.
Value added tax (VAT)
Charging a plug-in vehicle at home attracts only a 5% level of VAT, in comparison to 20% for road fuels.
Are you a business user? You’ll be pleased to know you can enjoy a wider range of tax benefits.
Plug-in Car or Van Grant
The UK government will also give you a grant towards the cost of a new electric car or van, provided it meets certain criteria.
The grant covers: * 35% of the cost of a car, up to a maximum of £2,500 depending on the emissions category the car comes under. * 20% of the cost of a van, up to a maximum of £8,000. * 20% of the cost of a taxi, up to a maximum of £7,500.
Am I eligible?
The grant you can get depends on the type of car you wish to buy.
The government has four categories:
| Category | CO2 emissions | Zero emission range | Grant | Maximum grant |
|---|---|---|---|---|
| 1 | Under 50g/km | At least 70 miles | 35% of cost | £4,500 |
| 1 (taxi) | Under 50g/km | At least 70 miles | 20% of cost | £7,500 |
| 2 | Under 50g/km | At least 10 miles | 35% of cost | £2,500 |
| 3 | 50 to 75g/km | At least 20 miles | 35% of cost | £2,500 |
| Van | Under 75g/km | At least 10 miles | 20% of cost | £8,000 |
Read the DVLA’s full list of plug-in vehicle categories.
Exemptions
You cannot get a grant for:
- Secondhand vehicles.
- Category 2 or 3 vehicles with a recommended retail price of over £60,000 and over.
How to claim
There is no application process for getting a government grant for your EV; the grant will be automatically applied at point of purchase.
You may be asked to fill out a short questionnaire, but overall the process is straightforward.
Electric Vehicle Homecharge Scheme
The UK government also recognises the need to provide help with funding the install of charging points at home. As such, there is also a grant available for this.
It’s a pretty good one, too. The grant gives you a 75% contribution towards your home charge point up to the value of £500 (including VAT).
As of May 2018, the scheme now includes vehicles eligible under the Plug-In Taxi Grant.
You can apply for this grant once per household/eligible vehicle.
Am I eligible?
The list of eligible vehicles is the same for this grant as it is for the Plug-in Car and Van Grant. However, this grant also applies to secondhand EVs.
In order to take advantage of this grant, your home must have off-street parking facilities where a charging point can be installed.
People who use an electric vehicle as a company car are eligible provided they are named as the primary user.
Full details can be viewed on the DVLA website.
Exemptions
You might not be eligible if:
- Your car isn’t eligible for the Plug-in Car or Van Grant
- You are not the primary user of the car
- You are leasing or hiring the car for less than 6 months
- You’re borrowing the car from friends or family
- You only have access to the car through a car club
- Your property is outside the UK
- You’ve claimed previously for EVHS or DRS
- You’re looking for a second charge point but only have one eligible vehicle
How to claim
This grant requires a little more effort than your purchase grant, but it’s not too difficult. All you need to do is to submit a grant claim including evidence of ownership, lease or primary use information to the government.
If you are accepted for the grant, you’ll then need to sign an OLEV installation form confirming the install details.
A certified installer will then install the charging point at your home.
Form details and contact information can be found on the DVLA website.