Offsetting your Green Investment
- Date: 11 November, 2021
It’s hard to ignore the Environmental headlines right now, it seems our Government are aiming to work towards a greener planet following the COP26 talks about net zero carbon emissions and reducing waste.
We've noticed an increase in demand in for Green Funding, in particular Solar Technology and Electric Vehicles, and have been discussing with our customers how they can pay for the cost of their investment, possibly making immediate cash savings.
We had a recent case where a client company have made the decision to become Carbon Negative. As part of this process the company is investing close to £23,000 in a Solar Energy creation and storge solution for their business premises. The business operates from a factory in the South of England where the roof is South Facing, ideal for harvesting Solar Energy.
- Our customer is financing the cost of the Solar Solution over five years via a Hire Purchase finance agreement. This should allow for a first year Super deduction allowance allowing the business to utilise 130% of the cost of the system in their writing down allowances calculation.
- They will be able to run the factory using energy created by the new solar system from the first day of installation.
- The cost of the Hire Purchase repayments will be lower than the old monthly electricity bill - an immediate cash benefit.
- If the system creates more power than is used by the company then it can be fed into the Grid which it will receive payments for.
The customer is also purchasing new electric vehicles, which can be charged at work and, which allow the company to offset a higher proportion of their cost against taxable income than their traditionally powered predecessors. In addition, the drivers also be entitled to a far lower benefit in kind charge for having the use of an electric powered Company vehicle.
Typically, if a company car driver switches to a Hybrid vehicle their benefit in kind charge will reduce by circa fifty percent. If they switch to a fully Electric vehicle their benefit in kind charge will be negligible, even if they drive the most expensive electric car available!!!
How We Can Help
Having worked with all kinds of companies across a range of industry sectors, we understand the challenges that exist with businesses not only wanting to become Carbon Neutral or Carbon Negative but the fact that they are starting to be pushed down that route by social and, possibly, legislative pressure.
With a focus on providing fast and flexible finance Green Asset Finance, our team will work with you to understand your specific requirements and provide you with a solution that works for you.