If you are looking to invest in a new company car programme, knowing the benefits for both your employees and your business is an important consideration.
Businesses understand the value of having green credentials. The UK government is making big strides towards tackling carbon emissions with policies advising businesses on ways to choose greener solutions. The ban on purchasing petrol and diesel-based vehicles by 2030 will have encouraged businesses to make a call to invest in an environmentally-friendly company car fleet and invest in electric charging points too on their premises.
Choosing the right electric vehicle (EV) for your company can cement your support for climate change. In addition, perhaps you’re investing in a company car scheme as a perk to retain talented staff or as a practical necessity to establish a new driver delivery fleet. It might be a strategic marketing decision to advertise your services or to promote a positive culture.
Whatever your reasons, from its engine size to its overall level of economy, there are a number of factors to consider. In this article we help you to consider a car that takes into account your budget, the tax efficiency and any long-term benefits that ensure your decision to ‘go green’ makes good sense from a business perspective.
How much are you looking to spend?
One of the biggest considerations you will need to make when choosing your company car is how much of a budget you have to play with. After all, considering recent times, it could now actually be better to reprioritise where you spend your money – whether that be hiring new staff, marketing the business and rebranding. In other words, it’s important to allocate a sensible budget.
Once you have this information to hand, you can then work out which makes of cars, models, engine sizes and engine types are actually realistic for you to buy. Alternatively, if you have your heart set on owning your dream motor but aren’t sure how you can afford it, there are also a wide variety of business contract hire and salary sacrifice deals currently available to help spread the cost on a sensible payment plan.
How often will you be using your company car?
If you are likely to be using your company car on a fairly regular basis, prioritising comfort over style and substance could be a good way to go. Both internally and in terms of how well it performs on the road, it’s important for you to feel at ease while out and about, able to relax and feel comfortable during any long business drives you will be needing to take.
And, while on the topic of taking long business drives, if you are more likely to use your company car for getting to and from client meetings in and around the city, then it could be a better investment to purchase a slightly smaller city car equipped with added bonuses like parking sensors. This, in turn, could make getting around a whole lot easier.
In simple terms, you need to work out how often you are likely to use your car and the types of drives you will be taking in it. That way, you will be able to more easily identify the right model to suit your exact requirements.
Why the right car can highlight your company’s green credentials
As a business, it is important to adapt and strategise to keep both your staff, clients, stakeholders and customers on side. With economic uncertainty, and the demand for fossil fuels globally impacting businesses of every size and sector, business leaders are making huge efforts to become greener.
With such overriding green agendas, there are worthwhile advantages for introducing hybrid or electric vehicles into your company to make that long-term investment. Cars like the Toyota Prius, Nissan Leaf and Hyundai Ioniq, for instance, are economical vehicles that are a popular choice for use as a company car. As well as being an appealing perk for staff, electric vehicles will also promote your green efforts and your brand’s pledge to cut carbon emissions.
What sort of tax implications will you need to consider?
When it comes to purchasing a company car that runs economically and won’t cost the earth, it’s important to consider the tax implications involved. In light of the government’s commitment to reducing emissions over the coming years, for example, cars that emit higher levels of CO2 are now subjected to paying a higher rate of tax. Offering employees electric vehicles, or new hybrid cars can now make financial sense to employers as a Benefit in Kind.
Just like any other type of business decision, deciding which company car is right for you will require you to review your objectives and identify your requirements before, ultimately, considering your options.
From the total budget you have to contend with, to the type of vehicle you are looking to buy, creating a pros and cons list and arranging a variety of test drives should then make the decision-making process a whole lot easier. By getting the balance right, implementing a new company car scheme can benefit your employees, support your efforts to create a positive working culture and boost your business.