Charging a Company Car at Home: UK Tax, HMRC Rates and Reimbursement (2026)

The Short Answer

If you drive a company electric car and charge it at home, your employer can reimburse you 7p per mile for home charging and 15p per mile for public charging — completely tax-free. No Benefit in Kind, no National Insurance, no complications.

The clever bit: if you charge at home on an off-peak EV tariff at ~7p/kWh, your actual cost per mile is around 1.8–2.5p. But HMRC lets your employer reimburse you at 7p per mile. That gap is real money in your pocket — and it's entirely legitimate.

How HMRC Advisory Electricity Rates Work

HMRC publishes advisory fuel rates quarterly to give employers a benchmark for reimbursing employees who charge company vehicles at home or on the public network. Since March 2026, the rates are:

These rates are not mandatory — employers can choose to reimburse at a different rate. But the advisory rates are the threshold below which reimbursement is automatically tax-free. Pay above the advisory rate and the excess becomes taxable.

The Tax-Free Profit from Smart Tariffs

This is where it gets interesting. The HMRC advisory rate of 7p per mile assumes you're charging at roughly the standard domestic electricity rate. But if you switch to an EV tariff like Octopus Intelligent Go at 7p/kWh, your actual cost per mile drops dramatically:

For a driver doing 10,000 business miles per year, that surplus works out to roughly £480–510 per year in tax-free income — simply because your electricity costs less than HMRC's benchmark assumes.

This is completely legitimate. HMRC sets advisory rates as a simplified benchmark. They explicitly state that employers do not need to check individual employees' actual electricity costs.

For real-time cost-per-mile data across every UK tariff, see our UK EV Charging Cost Index.

Step-by-Step: Getting Reimbursed

1. Track Your Business Miles

Keep a log of business miles driven in your company EV. Most company car policies already require this. Your employer may use a mileage tracking app, expense system, or simple spreadsheet. Only business miles qualify — commuting (home to regular workplace) does not count unless you have a home-based contract.

2. Split Home vs Public Charging

Since March 2026, HMRC allows different rates for home and public charging. If you charge at both locations, you can apportion your claim:

• Home miles × 7p = home charging reimbursement
• Public miles × 15p = public charging reimbursement

Your employer may ask you to estimate the split or provide evidence. In practice, most company car drivers do the majority of their charging at home, so many employers simply apply the 7p home rate to all miles.

3. Claim Through Your Employer

Submit your business mileage claim through your employer's normal expenses process. The reimbursement is processed through payroll but is not taxable and does not appear as earnings on your P11D — provided it's at or below the advisory rate.

4. Switch to an Off-Peak Tariff

To maximise the gap between your actual cost and the HMRC rate, switch to an EV tariff:

On a standard tariff, the HMRC rate roughly matches your actual cost — no surplus. On Octopus Intelligent Go, you pocket roughly 5p per business mile. See our full tariff comparison to find the best rate for you.

BIK on Electric Company Cars

The Benefit in Kind (BIK) rate for electric company cars is currently 2% (2025/26 and 2026/27), making EVs by far the most tax-efficient company car choice. For a £40,000 EV, the annual BIK tax for a 40% taxpayer is just:

£40,000 × 2% × 40% = £320 per year

Compare that to a £40,000 petrol car at 30% BIK: £40,000 × 30% × 40% = £4,800 per year. The EV saves you £4,480 in tax annually.

This is why salary sacrifice schemes for EVs have exploded in the UK — the combination of low BIK, tax-free charging reimbursement, and cheap home electricity makes company EVs extraordinarily cost-effective.

Can Your Employer Pay for a Home Charger?

This is a grey area that depends on the specific arrangement:

Employer buys the charger and installation outright: This could be treated as a BIK, but at the 2% EV BIK rate, the tax impact on a ~£1,000 installation is minimal (roughly £8 for a 40% taxpayer). Some employers absorb this as a business expense.

Employer reimburses you for installation: Similar BIK implications. Keep receipts and ensure it's processed correctly through payroll.

You buy the charger yourself: No BIK implications, but you can't claim tax relief on the cost against your employment income (unless you're self-employed).

The most common approach is for the employee to arrange and pay for installation themselves, then benefit from the ongoing HMRC advisory rate reimbursement — which, as we've shown, more than covers the installation cost over time at off-peak rates.

Best Chargers for Company Car Drivers

For company car drivers, the priorities are slightly different from private buyers:

Ohme Home Pro (£535) — Best for Maximising Savings

Smart tariff integration means you're always charging at the cheapest rate, maximising the gap between actual cost and HMRC reimbursement. Per-session cost tracking in the app also makes it easy to evidence your home charging for expense claims.

Tesla Wall Connector (£425) — Best for Tesla Company Cars

If your company car is a Tesla (the Model 3 and Model Y are among the most popular salary sacrifice choices), the Wall Connector offers seamless integration with the Tesla app, which logs every charging session with kWh and cost data — useful for expense reporting.

Hypervolt Home 3 Pro (£690) — Best App for Expense Tracking

The Hypervolt app provides detailed per-session energy and cost data that can be exported for expense claims. Smart tariff support, solar compatibility, and a premium build round out a strong package.

Key Dates and Rates to Know

We'll update this article when HMRC publishes new advisory rates in June 2026.

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