How to claim for charging your electric company car

More and more company car drivers are choosing to go electric, and that means lower running costs. But when can you claim for charging your car, and how do you do it? We have the answers...

Volvo V90 charging port

In theory, running an electric car as a company car should be incredibly convenient, because you can plug in to charge it at home, at work or even out and about.

However, the sheer variety of places to charge can cause headaches for business drivers. After all, you have to deal with different accounts, different apps and, if you're using contactless payment via a credit card, not necessarily being able to get a receipt. It's all a bit more complicated than simply asking for a receipt when you pay for petrol or diesel.

And that’s before you factor in home charging. How do you separate out the electricity used to charge the car from the electricity used to power your home activities every evening, for example? Fear not, though, because here we'll tell you how to make sense of it all, starting with home charging.

Vauxhall Mokka-e Hive EV charging on drive

Home charging

Charging up your electric car overnight at home is the simplest and most convenient way to run it. After all, you wake up every morning and set off on your day with, in effect, a full tank. But how do you work out the electricity used to recharge the car from everything else going on in your house? Well, the answer is with technology.

Since 2019, home charge points have had to have a data connection if they’re to be eligible for a grant. This means that the charger itself can let you know how much electricity has been used during the charging process and notify you accordingly through a smartphone app or a website.

This also means you can schedule the charging process to take place overnight, using cheap-rate electricity. Some modern chargers can also be linked to your company’s payroll system, which means your fleet manager and payroll department know exactly what you’ve paid to charge the vehicle, and can automatically reimburse you via your pay packet.

Where this (and any other) system falls down is that it can’t tell when you’re travelling for work or travelling for pleasure. HMRC does not recognise electricity as a source of fuel, which means that any expenses submitted using an electricity bill will be classed as a taxable benefit, unless the vehicle is used solely for business travel. However, if you cover private miles as well as business ones, you’ll need to prove what you were doing on any one journey.

Tesla Model 3 2022 front right tracking

Mileage rates

This is where HMRC mileage rates can come to your rescue. The Advisory Electric Rate (AER) allows a company car driver to claim the cost of a business trip in an electric car, at the rate of 5p per mile. This is largely what you can expect to pay for an overnight charge from your home charger. It's worth noting that plug-in hybrid cars get a different rate that's based on the size of their combustion engines.

However, the AER can feel a little derisory if you need to charge up from a public rapid charger. The good news is that if you’re shelling out more than you get from the AER, the reimbursement rate from your company can be adjusted, although you then face the spectre of additional-income taxation.

The industry is reacting, however, so some companies that specialise in fuel cards are also allowing drivers to use a card to recharge their vehicle, then bill the driver’s employer, bypassing the Government altogether.

Any electric car driver is likely to have numerous accounts with various charging providers, although some companies such as Zap-Map are getting providers together under one umbrella to allow drivers to pay using just one account. The driver then gets a copy of every charging receipt emailed to them, which they can pass on to their company where appropriate.

Lexus NX charging

Charging at work

If your place of business has charging points available to use, they can quickly become a very easy way to keep your electric car's batteries topped up. That's because HMRC doesn’t tax you on electricity provided by your employer’s charging points, so it makes sense to get in early and get your car plugged in.

What Car? says...

The easiest and least complicated way to charge your electric company car is to do so at your workplace. If you can’t, the next best option is the AER. Failing that, it’s vital that you keep accurate records of charging costs and what mileage you’ve covered, because it’ll save you a lot of hassle later.

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