Why the Ford Mustang Mach-E could be the perfect EV for a Psychologist or Therapist with limited company

Psychologists or Therapists with a Limited Company - Why the Ford Mustang Mach-E could be the perfect EV

In a positive turn up for the EV market, the  FT   have been lauding praise on the zero-emission vehicles which are changing the way in which many companies and business are offering benefits to their staff.

Company car and salary sacrifice schemes are back in vogue, with beneficial incentives for the employer and employee being underpinned by many manufacturer led deals for this type of product. Many brands do not want to undermine their retail and consumer facing propositions, so the carte-blanche discount slashing tactics are no longer employed quite as frequently.

Of course we are not immune to the fact that there is pressure being put on the Government to help more personal lease and purchasing customers make the transition into green technologies. With the younger generations placing more emphasis on the environment and longevity of the planet, this is something which needs addressing.

Even the BBC reported  on the importance of charge point infrastructure investment in the East of England in order to encourage tourism. Forward thinking / planning is the key to making the entire project work, as confidence is a big factor in moving towards BEV options.

But it isn’t just big businesses and corporates moving into electric cars. In the SME and owner-managed sectors, many have been refreshing their fleets and vehicle choices with pure electric solutions; and this includes the UK’s psychology and therapy industries.

Understanding the Tax implications associated with running your electric car for Psychologists or Therapists with a Limited Company

While many have operated as a sole trader (or partnership in the case of 2 or more), it is becoming more frequent for the business to move towards an incorporated body. Industry-specific organisations like Business of Counselling  and Sarah d.Rees  cover the pros and cons of moving into a limited company which are useful to consider.

Indeed we would always recommend that you speak to your accountant or tax advisor before making any firm decisions, as it is important to understand the financial implications, as well as the legal, regulatory or compliance aspects.

As with any arrangement and structure, there are always various elements to consider. Many mental health practitioners and counsellors who exit the NHS, where there is a great salary sacrifice scheme for EVs, will often set up a private practice at commercial premises or at home.

Perhaps initially a sole trader status will be used, because this is simpler and there are less statutory obligations and filing (although you need to register with HMRC to confirm this for your tax and National Insurance payments). As your therapy business grows, the limited company may offer a more tax efficient situation, and a risk separation, for you.

In doing so, you must disclose more financial information to Companies House on a yearly basis while engaging an accountant too. Risk is something any psychologist / therapist / counsellor has to review, in particular with professional indemnity, public liability and any director / officer liability insurance. Institutions like the British Association of Counselling and Psychotherapy -can help answer many of the queries or conundrums. 

But in moving to a limited company, there are some significant advantages when it comes to your new business car. Historically running a company car, or salary sacrifice scheme, was somewhat punitive and many directors and senior management would instead utilise a car allowance.

With regards to the latter, this involves an additional payment in your gross salary to cover motoring expenses. The issue with this is that higher rate income tax payers will lose 40% of this to income tax straight away, thereby diminishing the value of this additional contribution.

But the onset of electrification of our cars lead to some seismic changes to the UK’s tax regime, with HMRC essentially reducing the level of Benefit In Kind (BiK) payable on a zero-emission to 0%. While for tax year 2024/25 this has increased to 2%, in true financial terms there is a very nominal amount of tax to pay in a personal capacity as the employee.

Comparing company car v car allowance is no longer a useful debate when it comes to all-electric tech. And many therapists and counsellors will find that expenditure through their company is tax deductible, so that this reduces the level of Corporation Tax (25%) which is payable on their profits see UK Government website.

The monthly rentals you pay on a contract hire / lease is completely allowable against your limited company’s tax bill, as are the running costs - service/maintenance package, motor insurance, charge point expenditure and EV charging / electricity.

If you are Vat registered too, then you can reclaim some (or all) of this against the necessary expenditure. Unlike combustion, you do not incur a taxation for fuelling your vehicle via the company purse, so the electricity and running costs are essentially free. And if that wasn’t enough good news, then the below might give you an extra reason to select a Ford electric for your new car.

The Ford Mach-E, which you can configure at the Ford website, is the group’s flagship BEV option. While their latest innovation, the smaller SUV Explorer EV is also available, the bigger Mach-E has been the mainstay for company car and salary sacrifice customers since 2022. Indeed, in December 2023 the Ford team updated the Mach-E to bring in more specification choices and make some slight adjustments to the battery and performance. At 2024, choose from:

•  Select  - from £50,830 this has a 15.5” touchscreen, sensico trim, heated seats, wireless charging pad, 19” alloys, LED lights, privacy glass, 10.2” instrument cluster, dual climatic control, manual 6-way adjustable eats, BLIS, lane keeping aid, front/rear parking sensors, pre-collision assist and Thatcham Cat 1 alarm;
•  Premium - from £59,680 (RWD) and £65,405 (AWD) this adds perforated sensico trim, 8-way power seats with lumbar support, ambient lighting and red brake callipers. For the AWD you get a panoramic roof, hands free tailgate and B&O premium audio too; and     

•  GT - from £74,540 this adds sports seats, 20 alloys and adaptive suspension. 

In terms of the car shown, the Ford MUSTANG MACH-E ESTATE 216kW Premium 91kWh RWD 5dr Auto [Tech+] Pure Electric Vehicle, this is based on the following configuration:

•  Absolute Black - Solid paint
•  Perforated full sensico artificial leather - Black Onyx with red stitching
•  19" Black Machined Alloy Wheels with Red Brake Callipers
•  Mode 3 / Type 2 Charging Cable (Public Charging & home wallbox charger – Fast charging)

And how does the Ford MUSTANG MACH-E EV  perform?

This RWD SUV will have a 91 kWh usable battery which will offer 0 – 62 times of 7.0 seconds, 112 mph top speeds and 216 kW (or 290 hp). Expect a combined winter range of 250 miles with warmer weather allowing for 340 miles.

On charging, the 11 kW AC max will allow 9 hour and 45 min 0 – 100% charging times with the 150 kW DC maximum allowing 47 minute 10 – 80% times. A cargo volume of 322L is available with this car. It has a vehicle fuel equivalent of 133 mpg. It has no Bidirectional capabilities. The Mustang EV RWD can tow 750kg (Unbraked) or 1500kg (Braked).

For more information on electric car leasing for therapists, just head to our e-car lease website or call our expert team at e-car lease on 01942 910 001 or email at [email protected] for more information or advice.

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