Plug-in Car Grant: Everything you need to know

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The Plug-in Car Grant has been through a variety of changes since its initial launch in 2011. By providing a discount on the price of an electric vehicle, it has slowly helped motorists reduce emissions and take their first step into the future of cleaner driving.

As more and more electric vehicles have come to market in the nine years since its launch, the grant has undergone various changes, whether that’s adjustments to the amount available or plug-in hybrids no longer being eligible.

The grant was supposed to have ended this year, but the government has announced its continuation until 2023. Now at a reduced rate of £3,000, only electric vehicles are eligible for the grant and these must have a purchase price under £50,000, emissions of less than 50g/km and a zero emissions range of more than 70 miles.

Which lease cars qualify for the Plug-in Car Grant?

Compared to when the grant was launched in 2011, there’s a huge variety of choice on offer in the electric vehicle segment. These range from lowest priced models such as the new Skoda Citigo iV and new Renault Zoe up to the Hyundai Kona and Tesla Model 3.

These vehicles have CO2 emissions of less than 50g/km and can travel at least 112km (70 miles) without any emissions at all:

• Audi e-tron - Not eligible
• Audi e-tron Sportback - Not eligible
• BMW i3 and i3s
• BYD e6
• DS 3 Crossback E-Tense
• Hyundai Ioniq Electric
• Hyundai Kona Electric
• Hyundai Nexo - Not eligible
• Jaguar I-Pace - Not eligible
• Kia e-Niro
• Kia Soul EV
• Mercedes-Benz B-Class Electric Drive
• Mercedes-Benz EQC - Not eligible
• Mercedes-Benz eVito Tourer
• MG ZS EV
• Mini Electric
• Nissan e-NV200 (five-seater and seven-seater)
• Nissan Leaf
• Peugeot e-208
• Peugeot e-2008
• Porsche Taycan - Not eligible
• Renault Zoe
• Seat Mii electric
• Skoda Citigo-e iV
• Smart EQ fortwo
• Smart EQ forfour
• Tesla Model S - Not eligible
• Tesla Model X - Not eligible
• Tesla Model 3
• Toyota Mirai - Not eligible
• Vauxhall Corsa-e
• Volkswagen e-up!
• Volkswagen e-Golf

Unfortunately more premium models such as the Tesla Model X, Jaguar I-Pace and Audi e-tron are no longer eligible for the grant due to exceeding the £50,000 limit.

Compare all electric lease deals here.

Are options, packs and modifications included in the £50,000 eligibility cap?

The Office for Low Emission Vehicles (OLEV) has updated the definition of the price of an electric vehicle for the grant after the £50,000 eligibility cap was announced at Budget 2020.

Eligible cars must be priced below £50,000 RRP. OLEV's new definition of what can and cannot be used to calculate this price is:

Included:

• VAT, including VAT reclaimable by a business;
• Vehicle manufacturer or dealer’s mandatory extras including delivery charges or administration fees;
• The battery cost (including where the battery is leased);
• Any non-standard option fitted by the manufacturer or dealer affecting the powertrain.

Excluded:

• Any non-standard option fitted by the manufacturer or dealer which does not relate to the powertrain;
• Modifications such as ‘police packs’, ambulance/fire engine modifications;
• Modifications for disabled users;
• Warranty/Insurance and service packages etc;
• First registration fee and cost of first licence;
• Discounts.

How much of the Plug-in Car Grant am I eligible for?

If your electric vehicle fits the requirements of the grant – namely it has a zero-emission range of 70 miles between charging, CO2 emissions of less than 50g/km, and costs less than £50,000 – then you can benefit from the full grant. This pays 35% of the car’s value up to the £3,000 grant limit.

Due to the relatively short notice given by the government for the reduction of the Plug-in Car Grant from £3,500 to £3,000, various manufacturers offered to top up the extra £500 until the end of March 2020. This has now expired.

How much will the Plug-in Car Grant reduce my lease costs?

Rather than being deducted in one lump sum, the Plug-in Car Grant is deducted and spread evenly across the term of the lease. This can reduce the monthly cost of a 36-month contract by around 25%, or £100 a month, according to the British Vehicle Rental and Leasing Association (BVRLA).

This often helps bring the cost of a new EV in line with the price of an equivalent petrol or diesel model.

How do I apply for the Plug-in Car Grant?

When you place your order with the broker or dealer advertising the EV you want, they will handle the paperwork on your behalf and ensure the Plug-in Car Grant is requested and applied to your lease.

With the grant deducted from the car’s initial purchase price, everything should be in hand for emissions-free motoring.

How long will the Plug-in Car Grant be available?

Both the Society of Motor Manufacturers and Traders (SMMT) and British Vehicle Rental and Leasing Association (BVRLA) would like to see the long-term continuation of the Plug-in Car Grant as a way for motorists to ensure zero emission motoring remains a viable option for more and more drivers.

Currently the government has committed to continuing the Plug-in Car Grant until the end of the 2022-23 financial year.