Between generous government incentives, record-low tax rates, and unprecedented manufacturer support, the financial case for going electric has never been stronger.
Government Grants Are Still Available
The UK Government’s Electric Car Grant, launched in July 2025, continues to deliver substantial savings. The scheme offers discounts of £1,500 (or up to £3,750 for the most sustainably manufactured models) on qualifying electric vehicles priced at or below £37,000.
Over 40 models now qualify for the grant, including popular choices like the Renault 5, Nissan Leaf, Citroën e-C3, Vauxhall Corsa Electric, and many more. The grant applies automatically at the point of purchase – you don’t need to apply separately.
The scheme runs until 2030 or until funding runs out, whichever comes first. With over 40,000 drivers already benefiting and £650 million allocated, the pot could be exhausted sooner than expected.
Company Car Tax Remains Exceptionally Low
Benefit-in-Kind (BiK) tax for electric vehicles sits at just 4% for the 2026/27 tax year – far below the 20-37% charged on petrol and diesel company cars.
The difference is staggering. A higher-rate taxpayer driving a £45,000 electric car pays around £60 per month in BiK tax. The same driver in a similarly priced petrol car would pay approximately £450 per month – a saving of £390 every single month.
Whilst BiK rates will gradually increase (5% in 2027/28, 7% in 2028/29, 9% in 2029/30), they’ll remain dramatically lower than conventional vehicles for years to come. The current 4% rate represents a sweet spot before those increases take effect.
Salary Sacrifice Delivers Maximum Savings Right Now
Combining low BiK rates with salary sacrifice creates unprecedented savings in 2026. Employees save up to 60% on their monthly payments (depending on their tax bracket), paying for their EV from their gross salary before tax and National Insurance are calculated.
These savings are at their peak whilst BiK rates remain low. Every percentage point increase in BiK rates reduces your overall savings, making 2026 an optimal year to start your lease.
The Market Has Reached Critical Mass
The UK EV market achieved 22.7% market share in 2025, with over 1.75 million electric vehicles now on British roads. This isn’t experimental technology anymore – it’s mainstream transport with a proven track record.
What this means for you:
- Extensive choice: Over 130 EV models available, from small city cars to luxury SUVs.
- Competitive pricing: One in five new EVs now costs less than the average petrol or diesel car.
- Proven reliability: Millions of miles of real-world testing and feedback.
- Strong resale values: Growing demand in the used market supports lease values.
Charging Infrastructure Has Matured
Range anxiety? It’s rapidly becoming outdated. The UK now has over 87,000 public charging points across 44,000+ locations – an 18% increase from 2024 alone.
More importantly, home charging makes daily top-ups effortless. With off-peak electricity tariffs at around 7p per kWh, charging at home costs approximately £5 per 100 miles – dramatically cheaper than petrol’s £11-13 for the same distance.
The charging network continues to expand, particularly rapid and ultra-rapid chargers for longer journeys. By waiting, you won’t gain better infrastructure; you’ll simply lose time when you could already be enjoying lower running costs.
Running Costs Continue to Favour EVs
Beyond fuel savings, electric vehicles cost significantly less to maintain:
- Servicing: £140-250 annually vs. £205+ for petrol cars.
- No oil changes, spark plugs, or exhaust systems: Fewer parts mean fewer problems.
- Brake longevity: Regenerative braking means brake pads last much longer.
These savings compound over time. Over a typical three-year lease, you’ll save thousands compared to a petrol equivalent.
You might like this guide: Electric Cars vs Petrol Cars.
Tax Changes on the Horizon Make Acting Now Sensible
Whilst the fundamentals remain strong for EVs, the direction of travel for tax policy is clear: gradual increases are coming.
From April 2028, a 3p-per-mile road charge will apply to electric vehicles. Whilst this is still considerably cheaper than petrol (even with fuel duty), it does represent an additional cost that doesn’t exist in 2026-2027.
By starting your EV journey now, you’ll:
- Maximise your salary sacrifice savings during the lowest-tax window.
- Avoid the road pricing charge for at least two years.
- Benefit from current manufacturer incentives.
Make the Switch Through Salary Sacrifice
At EZOO, we specialise in making the switch to electric effortless through salary sacrifice. Our schemes include everything you need – insurance, servicing, breakdown cover, tyres, and road tax – in one simple monthly payment from your gross salary.
With current BiK rates at just 4% and salary sacrifice savings of up to 60%, employees can access electric vehicles that would be unaffordable through traditional purchase or lease. And, because the government grant applies to salary sacrifice schemes, you’ll benefit from both incentives simultaneously.