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SMEs / VSEs: what is a long-term lease?
As a reminder, a Long-term rental (LLD) is a type of financing that allows a company to lease an electric vehicle for a period of 1 to 5 years. During this period, the lessee agrees to pay fixed monthly instalments while benefiting from a range of services, including maintenance, financial loss cover and assistance.
This means that once the contract has been signed, it cannot be cancelled, unless there are exceptional circumstances, such as financial difficulties.
Who should consider long-term leasing?
Operational leasing is suitable for any size of business (SME, VSE, GE):
- taxis
- the liberal professions
- companies in any legal form
For further information: Everything you need to know about long-term leasing for electric cars.
Good to know: not to be confused with LOA (Lease with Purchase Option)The aim is to hire an electric car and buy it at the end of the hire contract, if the lessor is satisfied with the vehicle. If not, the lessor returns the vehicle to the owner.
Lease an electric car
Would you like to lease an electric car? Beev offers you 100 % electric cars at negotiated prices, as well as recharging solutions.
What are the advantages of leasing an electric vehicle for SMEs and VSEs?
As we have just seen, leasing is not just for large companies. SMEs and VSEs can also choose to have an electric vehicle for their business. But what are the advantages of using this method of financing?
Taxation
There are tax advantages to leasing an electric vehicle, particularly as regards the Company car tax (TVS).
As you know, any company owning one or more company vehicles is liable to pay VAT every year. Since the beginning of 2023, 2 new taxes have come into force :
- annual tax on CO2 emissions: an amount will be given according to the CO2 emission rate (tax power), depending on the date of entry into circulation),
- the annual tax on emissions of atmospheric pollutants: an amount will be determined according to the type of fuel and the year of entry into service.
The good news is that electric and hybrid vehicles emitting less than 60g/km of CO2 are not subject to VAT.
Taking out a leased electric vehicle also increases costs. Since the break-even point is high, there are savings on corporation tax (IS).
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Less restrictive financing
For a small or very small business, choosing to lease your electric car under a full service leasing contract means you can control your company's cash flow.
Since the long-term hire charge is fixed each month, expenditure is better controlled and anticipated, giving you greater budget visibility over the short, medium and long term. So there are no extra costs from the start to the end of the contract.
What's more, the occupants of the electric vehicle can drive away in complete peace of mind, safe in the knowledge that the owners of the property will take care (in full or in part) of the administrative formalities and a number of services, such as :
- the loan of a bridging vehicle,
- assistance,
- the cost of certificate of registration :
- maintenance
- changing tyres
- insurance
- regional and business tax
- CO2 tax
- management fee
- the transmission charge
- vehicle depreciation.
For a company, long-term leasing is a secure choice, since this type of financing does not use up equity capital and therefore allows better management of the debt ratio. On this last point, leasing an electric car is not seen as an investment, but as a cost.
In this way, the lease is deducted from the company's taxable income and the company can better optimise its borrowings for more strategic financing.
In the end, all you have to pay for is the use of the vehicle. Which is a good thing for small and medium-sized businesses wishing to switch to electric mobility, while preserving their cash flow.
Flexibility
Long-term leasing allows you to a flexible leasing contract. So, whatever the budget, the project, the needs or the activity of the company, the vehicle offers are adapted. What's more, these different elements can change over time. In this way, the leasing contract can be readjusted as soon as necessary on a number of points, such as :
- mileage
- services subscribed to
- the term of the lease
What's more, if the lessor has been satisfied with the leasing experience, it can reapply after the end of the 1st contract.
Good to know: If you want to encourage your staff to switch to electric mobility, you can offer them a vehicle for their home-to-work journeys or tell them about the social leasingOne of the President's promises for 2023. This social leasing scheme will give the most modest households the opportunity to opt for a electric vehicle at €100 per month.
A permanently new electric vehicle
Like any other vehicle, electric cars lose their efficiency over time. In order to continue using electric cars, long-term leasing allows the vehicle to be renewed. Drivers will therefore have good vehicle performance and lower breakdown risksalmost permanently. What's more, renewing the vehicle strengthens the company's brand image and increases employee satisfaction and confidence.
Good to know: the relay vehicle is a service that is not necessarily automatic, i.e. it may or may not be included in the rental. This varies from one electric vehicle owner to another.
Financial support for the energy transition
Did you know that the French government has introduced, and continues to introduce, financial incentives for the purchase of electric vehicles?
The list includes national financial assistance, such as :
- Le environmental bonus Applicable from 1 January 2018, this aid will go to purchasers or leasers of new cars, vans, 2 or 3-wheelers and electric quadricycles with CO2 emissions of between 0 and 20 g/km. The amount varies according to the vehicle chosen.
To find out more, we invite you to read our article on everything you need to know about the ecological bonus.
- The conversion premium by taking a thermal vehicle to scrap, the State pays a sum to purchasers or leasers of electric vehicles.
In addition to these, you have local grants that each metropolis has established itself.
This is the case of Ile-de-France region which aims to support SMEs and VSEs in their energy transition. For companies with fewer than 50 employees and annual sales not exceeding €10 million, the region is offering support for :
- 2 or 3-wheelers and electric quadricycles, up to €1,500,
- electric cars, vans and electric or hydrogen-powered vehicles, up to €6,000,
- lorries and road tractors over 3.5 tonnes, up to €9,000.
Good to know: it is possible to combine this local aid with the national aid. This cumulation is capped at 50 % of the purchase price of the vehicle including tax.
To find out more about this subject, you can do a simulation to find out about the aid available depending on where you live.
ADEME Green Loan for SMEs
To help SMEs and VSEs make the transition to a low-carbon economy, we have set up a special scheme: the ADEME green loan. With the collaboration of Bpifrance and Ademe, this aid has been set up as part of the Plan d'accélération de la transition écologique des entreprises.
The ADEME Green Loan is designed to help businesses finance their energy transition project, by financing tangible or intangible investments with a low collateral value and the increase in WCR (Working Capital Requirement) for the launch of the project.
This aid has several objectives:
- invest in electric mobility for its employees and goods,
- renew its business by offering products and/or services that protect the environment and/or reduce energy consumption,
- reduce its environmental impact through the circular economy* for example.
*Definition: thecircular economy is based on the principle of reusing second-hand goods, such as buying a used car instead of a new one. Not only does this reduce your environmental impact, it also saves you a lot of money.
What are the loan amounts?
Small or very small companies can benefit from a loan of between €10,000 and €1,000,000, with a term of 2 to 10 yearswith a maximum capital grace period of 2 years. This loan is repaid in quarterly instalments with straight-line capital repayment.
What are the conditions for obtaining this loan?
To qualify for this loan, certain conditions must be met:
- the amount of the loan must be less than or equal to the total amount of financial assistance granted for the project,
- the borrower's own funds,
- the project must be combined with external funding, such as equity or crowdfunding of at least the same cost,
- a security deposit of 5 % of the total amount is required. This is returned once the loan has been repaid in full.
How much does it cost to benefit from this aid?
Please note that in order to benefit from the ADEME Green Loan, there are costs involved:
- the preferential fixed rate with aid from ADEME. Eligible companies must be eligible for aid under the de minimis scheme,
- application fees
- death and disability insurance
You would like toto electric?
Beev offers multi-brand 100% electric vehicles at the best prices, as well as recharging solutions.
Which electric cars should you choose for your SME or VSE?
As an SME or VSE, you can obtain offers tailored to your needs and your project.
Electric cars
Fiat 500 Hatchback 24 kWh
Purchase price 30 400 €
(list price excluding bonuses)
Leasing with no deposit for professionals from €412/month
- Autonomy ( WLTP): 190 km
- Acceleration (0 to 100 km/h): 9 sec
- Fast charge (from 20 to 80 %): 24 min
Electric vans
Fiat E-Ducato 47 kWh
Purchase price 0 €
(list price excluding bonuses)
Leasing with no deposit for professionals from €699/month
- Range (WLTP): 170 km
- Acceleration (0 to 100 km/h): 10 sec
- Fast charge (from 20 to 80 %): 30 min
Fiat E-Ducato 47 kWh
Purchase price 0 €
(list price excluding bonuses)
Leasing with no deposit for professionals from €699/month
- Range (WLTP): 170 km
- Acceleration (0 to 100 km/h): 10 sec
- Fast charge (from 20 to 80 %): 30 min
Make your energy transition now, with several new 100 % electric vehicles available from Beev!
Bonus: other solutions to speed up your energy transition
Apart from leasing an electric vehicle for your company, which is already a good step, there are other solutions for accelerating your energy transition.
You can use theinstallation of recharging stations in your company car park. As well as electrifying your business, you'll be enabling your employees to employees to recharge their electric vehicles directly on site. This saves them a considerable amount of time.
At the same time, you can offer top-up cards for your employeesto recharge their vehicle at any charging point.
Beev offers these services with free personalised support. Our advisers are on hand to support you from start to finish. Don't hesitate to contact them.
Conclusion
With the above, it's possible for your small or very small business to lease an electric vehicle.
This method of financing will allow you to get around while reducing your costs. carbon footprint and by controlling your expenditure so that you can invest in your business.
For more information, we've put together a guide to this topic to explore the different aspects in depth:
Read our article about :
If you're interested in this subject, we invite you to contact our experts to help you choose your next electric vehicle.
