Eco & Low Emission Leasing in the UK
For those who live in and around London, the Ultra Low Emission Zone (ULEZ) has been introduced to the same areas of Central London as the current Congestion Charge. Unlike the Congestion Charge, the ULEZ runs 24/7, 364 days a year (minus Christmas Day). From the 25th October 2021, this area will be expanded to Inner London, within the North and South Circular Roads.
What does this mean for you? Ultimately, vehicles will be required to meet the new stricter standards on emissions in order to avoid paying the daily ULEZ charge, plus the congestion charge. More information about the ULEZ and the charges can be found on the Transport for London website.
Just because you do not live in London, doesn’t mean you shouldn’t consider driving an electric or hybrid car. Recent advances in technology means that these vehicles are extremely cost-effective, with very little running costs and road tax. You can also apply for the Plug-In Car Grant (PiCG) to make things easier. Eligibility for this grant is broken down into these categories:
- Category 1: Vehicles with a range of 70 miles making zero emissions, and a manufacturer quoted CO2 emissions figure of less than 50g/km.
- Category 2: Vehicles with a range of at least 10 miles making zero emissions, and a manufacturer quoted CO2 emissions figure of less than 50g/km.
- Category 3: Vehicles with a range of at least 20 miles making zero emissions, and a manufacturer quoted CO2 emissions figure of between 50-75g/km.
If your car qualifies for Category 1, then you can benefit from the PiCG maximum, which pays 35 percent of the car's value, up to a maximum amount of £4,500.
Category 2 and 3 vehicles also qualify for a 35% reduction, but the maximum amount saved is just £2,500, which is £2,000 less than for Category 1 cars.
However, as of November 2018, the government has stopped giving out grants for hybrid vehicles. Instead, you are only eligible if your vehicle is fully electric.
On top of this, when taking out a hybrid or electric vehicle business contract hire/lease, you pay a substantially less amount of company car tax. For more information on company car tax when leasing, take a look at our guide.