Transport is responsible for around a third of total CO2 emissions, so it’s little surprise that electric vehicles feature heavily in most government’s net zero emissions plans.

Switching from fossil fuel to battery-powered electric vehicles is a tangible way for small and medium-sized enterprises (SMEs) to reduce their carbon footprint.

In fact, a 2020 study by three universities (Exeter, Nijmegen (Netherlands), and Cambridge) found that in 95% of the world, driving an electric car is better for the climate than a petrol one.

Therefore, if more small businesses – which employ more than 16 million people in the UK – adopt electric vehicle (EV) technology, it could have a significant positive impact for the environment, as well as contribute to companies becoming carbon neutral overall.

What’s more, the government has introduced new incentives to help SMEs manage the upfront costs, so they can reap the longer-term carbon and monetary savings.

Here’s what we cover in this article:

Subsidies and tax breaks

Lower running costs

Learning by example: Moving to electric vehicle use

Subsidies and tax breaks

The initial cost of transitioning from fossil fuel to electric vehicles can be off-putting, but there are several grants and subsidies that can help your business manage the initial outlay, as well as several tax breaks that mean the technology is often more cost-effective in the long-term.

The Workplace Charging Scheme (WCS)

If your business is eligible, this voucher-based scheme can help with the upfront costs of the purchase and installation of EV charge points.

It’s limited to 75% for each socket, up to a maximum of £350 and 40 sockets across all sites per applicant. Vouchers can only be redeemed by approved providers.

To be eligible, your business needs to be able to show that it:

• Is a registered business or VAT registered.
• Can declare a need for electric vehicle charging equipment or an intent to encourage uptake among their staff and/or fleet.
• Has dedicated off-street parking for staff and/or fleets.
• Owns the property where the charge points will go or have consent for installation.

The UK Plug in Car Grant

Grants are also available for the purchase of qualifying electric vehicles through the plug-in car grant.

Businesses and individuals can get £2,500 off the price of an EV costing no more than £35,000; this was recently cut from £3,000 off the price of an EV costing up to £50,000.

Grants of up to £3,000 for vans and £6,000 for large vans are also available.

Benefit in Kind tax breaks

Employees can make considerable saving when their employer opts to invest in low emissions vehicles.

Company vehicles that are fully electric pay benefit in kind (BIK) tax rates of only 1% in the current 2021/22 tax yeare; this will rise to 2% in 2022/23.

This offers huge savings.

For example, in the 2021/22 tax year, the BIK per year for the e-Golf is £55.20 a year, whereas a Golf GT Petrol 1.5 is £1,392.

Cars with CO2 emissions of less than 50g/km are also eligible for 100% first year capital allowances.

This means with electric cars, companies can deduct the full cost from their pre-tax profits.

They’re also exempt from the London Congestion Charge (until April 2024) and road tax, also known as Vehicle Excise Duty (VED).

It’s worth noting that despite the fact there’s no road tax to pay for electric vehicles, you still need to go to the DVLA website (or make a phone call) to tax your vehicle.

Lower running costs

Electric cars are much cheaper to run than their petrol and diesel counterparts.

The average electricity costs to power a Nissan LEAF is around 3.9p per mile, compared to an average of 9.2p per mile on a petrol or diesel Ford Fiesta.

What’s more, if companies invest in solar panels on their buildings, they can essentially charge vehicles, in part, for no extra cost and offer access to this infrastructure as a free perk to EV-owning employees.

Stockport-based schoolwear supplier One+All is doing just this. The firm offers employees free car charging, powered by installed rooftop solar panels, while they’re at work.

“We want to try and incentivize people to personally make the switch to electric vehicles, as a when they’re able to,” says Chris Rowlinson, director at One+All.

Learning by example: Moving to electric vehicle use

One+All started its decarbonisation journey three years ago and is now certified carbon neutral by the Carbon Neutral global standard.

The company was using diesel vehicles but switched to full electric and hybrid, where it was not practical for full battery power due to mileage and lack of charging infrastructure, a few years ago.

Rowlinson says the move hasn’t required the company to increase its budget per car and has, overall, provided major benefits for employees.

“There’s no reason EVs should be more expensive on a like-for-like basis, but the amount of tax paid on them is negligible, you can save literally hundreds of pounds a month,” he explains.

Similarly, York Gin, a small gin distillery based in York, has recently invested in a fleet of three – soon to be four – electric, emission-free vehicles powered by renewable energy supplied by Good Energy.

Emma Godivala, director at the company, says when they started the switch in 2018 infrastructure was less ubiquitous. But this, and the technology, has improved over the years and the costs have come down.

“However, it’s not just a straight up cost of the vehicle equation, but the cost to the planet; you’ve got to think of the full spectrum,” says Godivala.

Her advice to companies considering adopting electric vehicles is to: “Lobby local MPs to make sure the infrastructure is there, order early because there is a time delay for delivery of the technology, and remember it really works for your customers, people feel better about emissions free products and are willing to pay a bit more for them.”

The post Electric vehicles: Grants and tax benefits for small businesses appeared first on Sage Advice United Kingdom.

Stephanie-May Elswood is the founder of Sasstainable, a lifestyle brand dedicated to cutting down on single-use plastics in favour of reusable products.

From bamboo toothbrushes and cutlery to reusable food pouches, collapsible cups, and silicone baking bundles, Sasstainable offers stylish ways to protect the planet every day.

Here’s what Steph has to say about the ins and outs of running an ethical online business.

First things first, what inspired you to start Sasstainable?

In a world where everyday products have short lives but long-lasting impacts, I wanted to create a brand to do the very opposite.

I had been researching into ways that I could be more sustainable in my personal life and wanted to solve some of my own unsustainable slip ups—single-use cutlery when grabbing lunch was my biggest downfall.

I wanted to develop a range of eye-catching, ethically made, and environmentally friendly products to help educate my audience and make it easier for people to respect the planet.

Did you get any outside investment to get started?

I started Sasstainable with my own savings, so there was no outside funding! I’ve re-invested all profits since.

What was the learning curve like?

Dramatic.

I made a lot of mistakes early on, and I had very little business experience in the e-commerce sector. My main background was in social media, content creation and marketing.

I was juggling every role in the company by myself, jumping between customer service, fulfilment, product development, and socials. It was stressful!

Having an e-commerce business is far more than just selling product and I don’t think I realised that. I often threw money at problems to try and fix quickly, them rather than take the time to find more suitable, cost-effective solutions.

One thing I learnt early on was to pay attention to seasonality.

For example, the company launched in November 2019, and I massively underestimated the kind of demand we’d have for Christmas. I under-ordered stock and didn’t fully consider the delays of postage during the festive season.

How many hours did you work on average, and what kind of support did you have?

It’s difficult to say exactly how many hours I committed initially. I was running this company in alongside my full-time social media business and charitable foundation, but I’m sure it was a lot!

I’m very lucky to have a supportive family, and that was a huge help especially in the early days.

My mum helped massively with the pick and packing, post office runs, and customer service.

I hired two assistants quite early on to help with the marketing and social media side of things, and that was one of my best decisions at that stage.

How did you build your customer base?

I was fortunate enough to have a small online presence on my personal Instagram, and that definitely helped get things moving.

If that’s something you could start nurturing now, then go for it.

I also did a lot of research into sustainability influencers and gifted products to them in exchange for an honest review. From the stories they shared on social media, we received more traction to our site.

What is the biggest challenge for a small business in going green, and how can overcome it?

Sustainability means not cutting corners.

There are so many ‘easier’ solutions that may not be sustainable. But as you’re growing and your company is in its infancy, you can start to implement those switches early on, so that your sustainability commitments increase as the business grows.

There will always be unsustainable companies that will undercut you and make it hard for you to compete.

But stick to your guns and know that you have a greater vision for the planet and entice your customers to come along for the journey.

What can small business owners do to take steps towards going green if they’re not already?

There are so many ways to be a more sustainable business. Look at every aspect from source to consumer, and don’t be afraid to ask questions.

Where are the products being made? Who is making them? What materials are being used?

Is your packaging eco-friendly? Can you find a fulfilment company that delivers products using electric vehicles?

You can also add a carbon offset feature to checkout, which will offset your shipping.

At Sasstainable, we’ve also collaborated with a brand called ‘Tree-app’ which allows customers to plant a tree with every purchase.

It’s also worth looking into eco-packing that is recycled or recyclable. It’s all about making small changes with a big impact, and helping your customers do the same.

What kind of setbacks did you face, and how did you navigate them?

I think the toughest challenge was finding product developers and manufacturers I could trust.

I never wanted to release a product that was anything less than perfect, but also wanted to ensure that it was affordable for customers.

From that, I have learnt never to accept the first unit cost given and to speak up even if I felt like I was being too demanding.

What was the most important thing you learnt as a business owner?

That it is not easy! But seriously, I’d say there are four main things I’ve learnt that are incredibly important to budding business owners:

• Control your cash flow. Having sufficient cash to fund my growth takes up most of my time.
• It’s all about the customer. The customer is always right, and the tone you used to respond to them sets the tone for the relationship you establish.
• Running a business can get lonely. It is important to constantly remind yourself of your vision and motivation behind the project. Cheer for your own successes, and don’t forget to celebrate the small wins.
• Build a team you can trust. It’s important to know how and when to scale your business, hire the right people, and crucially, learn to delegate key tasks so you can focus on growing your business and developing your products.

The post Ethical e-commerce: How I started a sustainable online business appeared first on Sage Advice United Kingdom.