The UK Autumn Budget 2025 brings significant changes for businesses operating fleets and considering electric vehicles (EVs). From new road pricing for EVs to extended grants and tax adjustments, these measures will shape fleet strategies for years to come. In this article, we break down the key updates, and explain why leasing EVs still offers flexibility and cost control in an evolving tax landscape.
Key Changes Affecting EVs and Fleets
Electric Vehicle Road Pricing
Intended to start April 2028, EVs will pay 3p per mile, and plug-in hybrids 1.5p per mile, under the new Electric Vehicle Excise Duty (eVED). This comes on top of standard Vehicle Excise Duty introduced in April 2025. For a typical EV doing 8,000 miles annually, that’s around £240 extra per year.
What this means for fleets: Accurate mileage forecasting becomes critical. TCH Leasing can help manage this uncertainty by offering predictable monthly costs.
Luxury Car Tax Threshold Raised
The Expensive Car Supplement threshold for EVs rises from £40,000 to £50,000 in April 2026. This saves many mainstream EVs around £425 annually, but premium models may still be affected.
EV Grants and Charging Infrastructure
The government has committed £1.3 billion to extend the Electric Car Grant until 2030, offering up to £3,750 for EVs under £37,000. Plus, £200 million for public charging and 10-year business rates relief for EVs.
Broader Fleet Cost Implications from the Autumn Budget 2025
• Fuel Duty Freeze continues until September 2026, helping mixed fleets.
• Writing-Down Allowances for low-emission vehicles are reduced, making leasing more attractive versus outright purchase.
• Salary Sacrifice Schemes for EVs remain tax-efficient, despite other changes.
Benefit-in-Kind (BiK) Rates
EV BiK rates stay low but will rise gradually:
• 3% in 2025/26
• 5% by 2027/28
• 9% by 2030 – Still far below petrol/diesel rates, making EVs attractive for company car drivers.
Why Leasing EVs Still Makes Sense
Despite narrowing tax advantages, leasing offers:
• Predictable Costs: Avoid residual value risk as EV taxes evolve.
• Flexibility: Upgrade as technology and incentives change.
• Access to Grants: Benefit from government support without large upfront costs.
Leasing helps businesses stay agile in a shifting policy environment, especially as EV running costs become more complex.
The Autumn Budget 2025 brings a new era for EV taxation, but incentives remain strong. For fleet managers, leasing electric vehicles is still the most cost-effective and future-proof strategy.