Can any small business owner with a Ltd company lease an electric vehicle?

Leasing an electric car as a small business owner

The rationale behind electric cars for a small business is becoming more and more apparent. Many of the UK’s SME accountants will have been busy during 2023, and into 2024, educating the directors / shareholders on the obvious tax incentives for converting their fleets from petrol and diesel vehicles into all-electric solutions.

As our information guides on  electric car leasing for your professions  , there are some amazing financial rewards if your business utilises them. And with more local strategies now in place to help drivers go electric, the obstacles and hurdles which were seemingly preventing the UK’s Net Zero ambitions are now being addressed.

For example, our local St Helens electric car customers received positive news from the council last week - in that a clear road map for the charging network has now been set. The St Helens Electric Vehicle Charging Infrastructure (EVCI) Strategy has been created to ensure an effective plan can be put in place for residents and businesses in the area, with much of this set to cover the next 5 years and which will coincide with the Government’s ZEV Mandate.

St Helens will now be reviewing local infrastructure to create an Asset Plan, which is ultimately about understanding the suitability of “on and off” street charging, lamppost charging and high-powered solutions. As the Council have identified, a number of barriers were identified as to why local business and residents would be reticent to buy or lease an EV and this included:

•  Cost of electricity;
•  Ability to charge at home; and
•  Ability to charge away from home

Confidence in your constituency is key for the EV transition. Regardless of how cheap or cost-effective the BEV is, should you have a lack of faith in facets like range, charging or running costs, then local St Helens businesses will simply not make that transition.

Dedicated and focused plans, like improvements to local infrastructure at key destinations, supermarkets, on-street solutions and rapid-charging do allow for a growth in confidence and a normalisation of how, and when, EV drivers need to charge their new vehicles. For local customers looking into electric vehicles, head over to their dedicated EV sections at the St Helens council website.  

But how can my business apply for a car lease? Is it an automatic approval?

When you have received a formal quotation on your new EV from our e-car team, you will be asked to complete a “Credit Application”, which is a form which our team requires.

As a credit broker, not a lender, we do not make the decision on the credit aspects; we submit your details to the selected finance company / funder for your deal. Because each finance company can ask for slightly different information, our application process is a little more detailed so that we have more than enough information to submit. In particular we need:

•  Company Name and Number - while you can supply a trading name, we do need the registered name and number from Companies House, as the finance company will use this to carry out rudimentary checks;
•  Established Date - we need to know when you set up the company. Some finance companies will only provide finance for a company which is either one or two years old. In some cases we can submit additional information to overcome this but in others, it is simply not possible to proceed and we need to make an application to another company. If you have no filed accounts then you are treated as a “new start company”;   
•  Vat Number - if you are VAT registered (because your turnover exceeds £85,000), then you are entitled to reclaim VAT on the finance and maintenance elements;
•  Director Details - so long as your company has 2 (or more) directors we do need their full name, date of birth, 3-year home address, email address and telephone number. To be clear, some of our finance companies will search the credit profile of the directors you provide (this is often done as a “soft search”). So if a business has strong accounts but the director has a weak credit profile, this could influence the credit decision. Similarly, for new-start companies, or those with a low net worth, having a director with a strong personal credit profile will assist. Ensure that you receive express permission from any directors that it is possible to utilise their details;
•  Bank Details - any vehicles will be paid by way of direct debit i.e. you cannot use cash or a separate invoice. The bank details must be for your company; you cannot use a parent or subsidiary to pay for this vehicle nor can you use a personal bank account;
•  Additional Information - on a case to case basis we may need - a) your latest full accounts b) management accounts c) confirmation of any vehicles you have on fleet d) bank statements e) driving licence and/or proof of address for any directors.  

Before you formally process the application with our team, it is always worth checking your business at Companies House to ensure your details are correct and that your accounts are up to date.

Also speak to any directors on the application to ensure their personal details are up to date and accurate i.e. address history or credit profile . In some cases, the underwriting team will ask for special measures in order to approve the application, such as a director’s guarantee or a bigger upfront initial rental. Our team will always communicate this to you when we receive this information.

And the ID Buzz proved to be one of the best family EVs of 2023 (and into 2024). While electric cars have been lamented for being boring or stoic, the Buzz from the VW group is anything other than this.

In terms of the car shown, the Volkswagen ID.BUZZ ESTATE 150kW Style Pro 77kWh 5dr Auto Pure Electric Vehicle, this is based on the following:

•  Energetic Orange Metallic Paint
•  Styling Seat Pack – Fabric ArtVelours ECO microfleece – Mistral with Orange/Silver Birch dashboard
•  20" Solna black diamond turned surface alloy wheels
• Without rear view camera
•  Assistance Package Plus
•  Open & Close Package Plus
•  Infotainment Package Plus
•  Retractable tow bar, with electrics  

But how does the ID Buzz perform?

This RWD minivan will have a 77 kWh usable battery which will offer 0 – 62 times of 10.2 seconds, 90 mph top speeds and 150 kW (or 201hp). Expect a combined winter range of 180 miles with warmer weather allowing for 240 miles.

On charging, the 11 kW AC max will allow 8 hour and 15 minute 0 – 100% charging times with the 175 kW DC maximum allowing 30 minute 10 – 80% times. A cargo volume of 1121L is available with this car. It has a vehicle fuel equivalent of 110 mpg. The ID Buzz can tow 750kg (Unbraked) or 1000kg (Braked). In terms of vehicle dimensions, the vehicle is 4712mm in Length, 1927mm in Height and 2211mm in width (including mirrors).