Tesla finance and PCP explained: deals, APR and what you pay
Tesla is offering 0% APR on the Rear-Wheel Drive Model 3 and Model Y until the end of 2026. Here is how its PCP works, what you pay at three deposit levels and where the costs hide.
Quick answers
- Tesla's UK representative example puts the Model 3 Rear-Wheel Drive at £299 a month for 47 months at 0% APR, after a £5,600 down payment, with an optional final payment of £18,333.
- The Model Y Rear-Wheel Drive example is £349 a month for 47 months at 0% APR, after a £6,850 down payment, with an optional final payment of £21,753.
- Both 0% offers require you to order and apply for finance by 31 December 2026 and take delivery by 31 March 2027, and apply only to the Rear-Wheel Drive versions.
- On EV Compared's calculation, a Model Y Rear-Wheel Drive costs about £399 a month with a 10% deposit, £303 with 20% and £207 with 30%, and at 0% APR the total you pay is the same whichever you choose.
- Tesla's examples allow 8,000 miles a year and charge 14p a mile plus VAT above that, so driving 10,000 miles a year for four years would add about £1,344 at the end.
- On our figures, financing the same Model Y at a typical 8.9% broker APR instead of 0% would push the monthly payment from about £399 to about £629 and cost roughly £10,800 more in interest.
- The Model Y Premium Long Range AWD (£52,990) and both Performance models sit above the £50,000 expensive car supplement threshold, which adds £440 a year in vehicle tax for five years.
Tesla finance in the UK is cheapest right now on the Rear-Wheel Drive Model 3 and Model Y, which Tesla offers at 0% APR on PCP: £299 a month for the Model 3 and £349 for the Model Y in its own examples. Because there is no interest, a bigger deposit lowers your monthly bill but never your total cost.
This guide covers how Tesla’s Personal Contract Purchase (PCP) works, what the current offer includes, what you would pay at three deposit levels, and the charges that sit outside the monthly figure. Prices are Tesla UK list prices in November 2026, as reported by EV Industry News from Tesla’s site.
What finance does Tesla offer in the UK?
Tesla arranges finance itself as part of the online order, rather than through a dealer. The main product for private buyers is PCP, which Tesla calls Contract Purchase. You pay a down payment, then a fixed monthly amount, and at the end you choose whether to pay an optional final payment and keep the car.
That final payment is Tesla’s guaranteed future value: its forecast of what the car will be worth at the end of the term. Because you are only paying off the gap between the price and that future value, PCP payments are lower than on hire purchase, where you repay the whole price over the term. Broker Kandoo describes PCP terms of two to four years; Tesla’s current examples run for 48 months.
If you are still weighing up the finance route itself, our guide to leasing vs PCP vs buying an EV sets out the trade-offs.
What is Tesla’s current 0% APR deal?
Tesla’s UK representative examples, reported by LivinintheUK on 11 October 2026, are:
| Model 3 Rear-Wheel Drive | Model Y Rear-Wheel Drive | |
|---|---|---|
| Cash price | £37,990 | £44,990 |
| Down payment | £5,600 | £6,850 |
| Monthly payments | 47 x £299 | 47 x £349 |
| Optional final payment | £18,333 | £21,753 |
| APR | 0% | 0% |
| Term | 48 months | 48 months |
| Annual mileage | 8,000 | 8,000 |
To qualify you must order and apply for finance by 31 December 2026 and take delivery by 31 March 2027. The 0% rate applies only to the Rear-Wheel Drive versions. The Premium Long Range and Performance cars carry interest: in February 2026, owners on the Tesla Motors Club forum reported PCP rates of 3.9% for the Premium Model Y and 6.9% for the Performance.
Tesla has run cheap entry finance before. When the Model Y Standard launched in December 2025, Electrifying reported a headline £299 a month. Our Tesla UK prices page tracks how list prices have moved since.
What do you pay at different deposits?
Tesla sets the optional final payment from the car’s forecast value, not your deposit, so changing the deposit only changes the monthly amount. We worked out the payments at 10%, 20% and 30% deposits.
Method: (cash price minus deposit minus Tesla’s optional final payment) divided by 47 monthly payments at 0% APR, rounded to the nearest pound.
| Deposit | Model 3 RWD (£37,990) | Model Y RWD (£44,990) |
|---|---|---|
| 10% | £3,799 down, £337 a month | £4,499 down, £399 a month |
| Tesla’s example | £5,600 down, £299 a month | £6,850 down, £349 a month |
| 20% | £7,598 down, £257 a month | £8,998 down, £303 a month |
| 30% | £11,397 down, £176 a month | £13,497 down, £207 a month |
The key point is that at 0% APR the total stays at the cash price whichever deposit you choose. Every extra £1,000 you put down cuts the Model Y payment by about £21 a month, but you do not save a penny overall. If you have savings earning interest, a smaller deposit leaves that money working for you. A bigger deposit makes sense mainly if you want the lowest monthly figure, or if you plan to keep the car and want a smaller sum left to pay or refinance at the end.
How much is 0% APR actually worth?
It is worth thousands of pounds. Broker examples from Kandoo use an 8.9% APR on Tesla PCP. On our calculation, the same Model Y Rear-Wheel Drive with a 10% deposit and the same £21,753 final payment would cost about £629 a month at 8.9%, against £399 at 0%.
Method: the amount borrowed (£40,491) less the present value of the final payment at 8.9% APR, spread over 47 monthly payments at a monthly rate of 0.713%.
That works out at roughly £10,800 more over four years. It is also why the Premium versions cost more on finance than the gap in list price suggests: a £49,990 Premium Long Range RWD Model Y pays interest on every pound borrowed, while the £44,990 Rear-Wheel Drive pays none. Our guide to which Tesla to buy compares what each version gives you for the money.
What costs are not in the monthly payment?
Three costs catch out PCP buyers.
Excess mileage. Tesla’s examples allow 8,000 miles a year, and the Model 3 example charges 14p a mile plus VAT above that if you hand the car back. On our figures, driving 10,000 miles a year for four years means 8,000 excess miles, or £1,120 plus VAT: about £1,344. If you know you drive more, agree a higher allowance at the start, which raises the monthly payment but usually costs less than paying the excess at the end. Our guide to the cost to charge a Tesla shows what those miles cost in electricity.
Condition. If you return the car, damage beyond fair wear and tear is charged. If you pay the final payment and keep it, this does not apply.
Vehicle tax. Electric cars now pay the £200 standard rate, and those with a list price over £50,000 pay an extra £440 a year for five years from the second year of tax, according to GOV.UK. Both 0% cars are under the threshold. The Model Y Premium Long Range AWD (£52,990), Model 3 Performance (£59,990) and Model Y Performance (£61,990) are over it, which adds £2,200 across five years. The Premium Long Range RWD Model Y, at £49,990, sits £10 under the line.
Is a Tesla PCP better than leasing?
On the current 0% deal, PCP can cost less than leasing even if you hand the car back. Carwow lists personal contract hire from £370 a month for a Model 3 and £495 for a Model Y, on 48 months with a nine-month upfront fee and 8,000 miles a year.
| Over four years, then hand back | Model 3 | Model Y |
|---|---|---|
| Lease (9 upfront + 47 monthly) | £20,720 | £27,720 |
| Tesla PCP (down payment + 47 monthly) | £19,653 | £23,253 |
Method: lease monthly price x 56; PCP down payment plus 47 x the monthly payment in Tesla’s example.
The PCP also gives you the choice to keep the car at the end, which a lease does not. Leases can still win when a lender runs a cheaper deal or includes extras, and lease prices exclude fees. Company car drivers should look at salary sacrifice instead; our guide to Tesla company car tax explains how the 4% benefit-in-kind rate for 2026/27 applies.
Can you end a Tesla PCP early?
Yes. You can ask Tesla for a settlement figure and pay off the balance at any time. You also have a legal right to voluntary termination: under section 100 of the Consumer Credit Act 1974, you can hand the car back once you have paid half the total amount, provided it has been looked after.
On a PCP that halfway point comes late, because the final payment counts towards the total. On Tesla’s Model Y example, half of the £44,990 total is £22,495. After the £6,850 down payment, that is roughly the 45th of 47 monthly payments. So plan on keeping the car for most of the term.
One more point if you have heard about car finance payouts: agreements at 0% APR are excluded from the FCA’s motor finance redress scheme, so a Tesla 0% deal carries no claim. Our guide to car finance compensation explains who does qualify.
What should you do before you sign?
- Choose the version first. The 0% rate only applies to the Rear-Wheel Drive cars, and the interest on other versions changes the comparison.
- Set your mileage honestly. Take your annual mileage from your last two MOT certificates.
- Compare total cost, not the monthly figure. At 0% APR, the total equals the cash price, so the only question is how you want to split it.
- Check the deadlines. Order and apply by 31 December 2026, with delivery by 31 March 2027.
- Read the representative example in full. It shows the down payment, final payment, total payable and mileage terms that apply to you.
How we test and where our numbers come from
Range figures are official WLTP combined values taken from manufacturer UK specification pages, with real-world estimates drawn from independent comparative testing. Prices are UK list prices at the time of the latest update. Tax, grant and charging-scheme figures come from GOV.UK and HMRC publications. We re-check every guide when pricing, specification or policy changes. Last checked 1 November 2026. How we work out our own figures.
Frequently asked questions
Does Tesla offer 0% finance in the UK?
Yes, Tesla is offering 0% APR on the Model 3 Rear-Wheel Drive and Model Y Rear-Wheel Drive for orders placed and finance applied for by 31 December 2026, with delivery by 31 March 2027. The 0% rate does not apply to the Premium Long Range or Performance versions.
How much is a Tesla Model 3 a month on PCP?
Tesla's representative example for the Model 3 Rear-Wheel Drive is £299 a month for 47 months at 0% APR. That assumes a £5,600 down payment, a £37,990 cash price, 8,000 miles a year and an optional final payment of £18,333 if you want to keep the car.
How much is a Tesla Model Y a month on PCP?
Tesla's representative example for the Model Y Rear-Wheel Drive is £349 a month for 47 months at 0% APR, after a £6,850 down payment. The cash price is £44,990 and the optional final payment is £21,753. On our calculation, a 20% deposit brings the monthly payment down to about £303.
Is a bigger deposit worth it on Tesla's 0% PCP?
A bigger deposit lowers your monthly payment but does not save you any money at 0% APR, because there is no interest to reduce. On a Model Y Rear-Wheel Drive, every extra £1,000 of deposit cuts the payment by about £21 a month, and the total paid stays at the £44,990 cash price.
What happens at the end of a Tesla PCP?
At the end of a Tesla PCP you can pay the optional final payment and keep the car, hand it back, or part-exchange it. If you hand it back, you pay excess mileage charges above the agreed allowance, which Tesla's Model 3 example sets at 14p a mile plus VAT, and any charges for damage beyond fair wear and tear.
Can I end a Tesla PCP early?
Yes, you can settle the agreement early at any time, or use voluntary termination once you have paid half of the total amount payable. On Tesla's Model Y example, half the total is £22,495, which you would only reach around the 45th of 47 monthly payments.
Sources and further reading
- livinintheuk.comTesla Model 3 from £299 a month, 0% APR (LivinintheUK, 11 October 2026)Reproduces Tesla UK's representative PCP examples: Model 3 RWD £37,990, £5,600 down, £32,390 credit, 47 x £299, £18,333 final payment; Model Y RWD £44,990, £6,850 down, 47 x £349, £21,753 final payment; 0% APR, 48 months, 8,000 miles a year, 14p a mile plus VAT excess; order by 31 December 2026, deliver by 31 March 2027.
- evinfo.infoTesla UK prices October 1st 2026UK cash prices for every Model 3 and Model Y version, from £37,990 (Model 3 RWD) to £61,990 (Model Y Performance).
- kandoo.co.ukHow to finance a Tesla Model YBroker guide updated 24 September 2026 using an 8.9% APR in its Tesla PCP and HP examples, and PCP terms of two to four years.
- carwow.co.ukNew Tesla Model Y deals and offersPersonal contract hire from £370 a month for the Model 3 and £495 for the Model Y, on a 48-month term with a nine-month upfront fee and 8,000 miles a year.
- legislation.gov.ukConsumer Credit Act 1974, section 100On voluntary termination of a hire purchase or conditional sale agreement, the borrower pays up to one half of the total price.
- gov.ukVehicle tax for electric and low emissions vehiclesExpensive car supplement applies to electric cars with a list price over £50,000, for five years from the second year of tax; standard rate £200.
- gov.ukVehicle tax rate tablesThe expensive car supplement is an extra £440 a year.
- electrifying.comTesla Model Y gets new cheaper entry modelThe Model Y Standard launched in December 2025 with a headline finance figure of £299 a month.
- teslamotorsclub.comPCP Model Y APR (Tesla Motors Club forum)UK owners reported on 14 February 2026 that Tesla PCP rates were 3.9% for Premium Model Y and 6.9% for Performance, with 0% on the entry car.
EV Compared
The EV Compared editorial team tracks the UK electric vehicle market full time: new model launches, list prices, WLTP and real-world range, public charging tariffs and the tax rules that decide what an EV actually costs to run. Every guide is checked against manufacturer specifications and official GOV.UK figures, and updated whenever the numbers move.
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