From 1st September 2025, fully electric cars will have two separate advisory fuel rates, depending on whether the electric car is charged at home or at a public charging station.
Employees can use HMRC’s advisory fuel rates for reimbursement for business travel in company cars, or if they have to repay their employer for fuel used for private travel.
Read on to learn how electric car charging rates are changing and how this might affect employees and employers using electric company car schemes in the UK.
What are the new electric car charging advisory rates?
Previously, the electric car rate was 7p per mile, no matter where the vehicle was charged. Reimbursing at this rate meant drivers would face a shortfall if they used more expensive public charging networks.
Advisory rates for charging electric cars are now 12p for public charging and 8p for home charging.
The new rates can be applied from 1st September, though the previous single rate will still be available until 30th September. From 1st October 2025, only the new rates will apply.
This change reflects the higher cost of using public chargers, but it’s based on the cost of a slow or fast charge – not the more expensive ultra-fast charging that many drivers may use to save time.
Drivers can only be reimbursed for the higher cost of super-fast charging if it can be substantiated.
How might this affect electric company cars?
When business mileage on company cars is reimbursed at acceptable rates, employees and employers won’t face taxable fuel benefits or National Insurance Contribution implications.
However, record-keeping for different charging locations may become more complicated for employers.
It’s also important to note that the new advisory rates only apply to fully electric cars. As hybrid cars are treated as petrol or diesel vehicles, the advisory rates for those types will apply.
The petrol rate isn’t changing, but some diesel rates are increasing by 1p per mile. More information about advisory fuel rates for company cars is available on the government website.
If you need financial advice or accounting support to help manage company car costs, our accountants in Barnsley can provide tax consultancy and payroll services at gbac.
To get in touch, call 01226 298 298, or send an email to info@gbac.co.uk to find out more.