Accelerated Capital Allowances with Electric Vehicles - Know Your Eligibility to EV Tax Incentives
You don't have to be an accountant to make sense of the savings you and your business can make!
- Available on New 100% Electric Vehicles purchased by Ltd Company’s & Sole Traders
- Eligible candidates can claim lower of purchase price or €24,000 against trading profits in year of purchase
- Full Cap Allowance Tax saving accomplished in Year 1 of ownership
- Conventional company vehicle takes 8 years to realise this saving
- Half-Price Tolls
- Cash saving on tax liability increased cash flow
- Sole Traders eligible for €24,000 deduction against trade profits taxed at their effective rates
- Charge stations also eligible for ACA, typical cost €1,500
To learn more about the BIK savings for both employees and employers, see our in-depth article here.
ACA Tax Saving Examples
ACA - Ltd Company EV Benefits Explained
The following example compares a Ltd company purchasing a Electric Vehicle and a conventional fossil fuel vehicle of similar size, both with a R.R.P of €28,000
| Trading Profits | €100,000 | €100,000 |
| Proportion of Deductible Vehicle Costs | 8/8 (100%) | 1/8 (12.5%) |
| Deductible Vehicle Costs | €24,000 | €3,000 |
| Deductible Charge Point | €1,500 | NA |
| Taxable Profits | €74,500 | €97,000 |
| Tax Payable @ 12.5% | €9,312 | €12,125 |
| Tax Saved | €3,187 | €375 |
Over 8 times the tax saving compared to a fossil fuel vehicle in Year ONE!
ACA - Sole Trader EV Benefits Explained
The following examples compare a Sole Trader purchasing an Electric Vehicle and a conventional Fossil Fuel vehicle both with a R.R.P of €28,000. Sole Traders tax rate is 52%. (2019 tax rates and bands are assumed)
| Trading Profits | €100,000 | €100,000 | |
| Deductible Vehicle Costs | €24,000 | €3,000 | |
| Taxable Profits | €76,000 | €97,000 | |
| PAYE Payable | €20,340 | €28,740 | €8,400 |
| PRSI | €3,040 | €3,880 | €840 |
| USC | €2,951 | €4,631 | €1,680 |
| Total Tax Payable | €26,331 | €37,251 | €10,920 |
| Trading Profits | €50,000 | €50,000 | |
| Deductible Vehicle Costs | €24,000 | €3,000 | |
| Taxable Profits | €26,000 | €47,000 | |
| PAYE Payable | €2,200 | €8,740 | €6,540 |
| PRSI | €1,040 | €1,880 | €840 |
| USC | €493 | €1,438 | €945 |
| Total Tax Payable | €3,733 | €12,058 | €8,325 |
Who's Not Eligible?
- Motor distributors
- Motor Dealers
- Car Hire Company’s
- Vehicles are classed as stock in trade & not eligible for ACA
- EV’s must be owned by the business
- Lease & Hire arrangements do NOT count as ownership
Charge Points & Providing Electricity
The provision of electricity through company owned charge points to charge Employee electric vehicles will not give rise to a taxable benefit for the employee or director from 1 January 2018. This dramatically reduces fuel costs and is also applicable to non company owned EV’s. Effectively an employee can benefit from free fuel from their employer. An employer may cover the cost of charging provided to employees or indeed develop a revenue stream by installing charge points on site. This would also apply to retailers, car park companies etc and there is no licence required to sell electricity through a charge point
Windsor EV
Across our Natiowide Nissan Dealerships we stock the Nissan LEAF, the world and Ireland's leading EV. We also supply the eNV200, their fully electric version of the versatile NV200. While in our Renault Dealerships located in Galway and Airside, Swords, we stock the Renault ZOE and Renault Twizy.
The Nissan LEAF is Ireland's Best-Selling Electric Vehicle. In 2017 there were 257 Nissan LEAFs sold in Ireland. In 2018 that number skyrocketed to 789 units sold, an increase of 207%. Of that impressive number, more than 75% of LEAFs in Ireland were sold by Windsor Nissan dealerships – making Windsor the #1 seller for Electric Vehicles in Ireland in 2018.
