COMPANY car owners who have electric cars are in for a shock.
They might be able to charge their company car but they can’t charge for business mileage.
And the reason, according to the tax man, is that electricity is not a fuel.
HMRC rules say that “advisory fuel rates are based on the average price of fuel per mile – electricity is not a fuel”.
ACFO, the UK’s leading fleet-decision-makers’ organisation, is holding ongoing discussions with HM Revenue and Customs about electric business car mileage rates but currently there is no way to reclaim the cost of the electricity used.
So sadly there is no good news for the reader, Chris Sullivan, who contacted us to say he personally paid for the electricity that powers his Nissan Leaf company car – at 5p per mile or £400 per year – and couldn’t find an electric business car mileage rate to claim back his expenditure.
It would be different if he had bought the car privately and then expensed the running costs through the company via the AMAP rates, which would be 45p per mile tax free for the first 10,000 miles of business mileage, and 25p per mile thereafter – see the comments section of our story Tax: Business mileage rates for using a private car (AMAPs).