Charging a Company Car at Home UK: Tax & HMRC Rates

The Short Answer

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

The arbitrage: on an off-peak EV tariff at ~7p/kWh, the actual cost per mile is around 1.8–2.5p, but HMRC allows reimbursement at 7p per mile. That gap is legitimate income.

How HMRC Advisory Electricity Rates Work

HMRC publishes advisory fuel rates quarterly as a benchmark for employers reimbursing charging costs. From March 2026:

These rates are not mandatory — employers can reimburse at a different rate — but they mark the threshold below which reimbursement is automatically tax-free. Anything above becomes taxable.

The Tax-Free Gap on Smart Tariffs

The 7p per mile advisory rate assumes charging at roughly the standard domestic rate. On an EV tariff like Octopus Intelligent Go at 7p/kWh, the actual cost per mile drops well below that:

At 10,000 business miles a year, that surplus is roughly £480–£510 in tax-free income — the gap between actual electricity cost and HMRC's benchmark.

HMRC sets the advisory rates as a simplified benchmark and explicitly states that employers do not need to verify individual 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 Business Miles

Keep a log of business miles. Most company car policies already require this; the tooling varies from app to spreadsheet. Only business miles qualify — commuting from home to a regular workplace does not count unless the contract is home-based.

2. Split Home vs Public Charging

From March 2026, HMRC allows separate rates for home and public charging. If both apply, the claim apportions:

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

Some employers ask for an estimated split or evidence; many apply the 7p home rate to all miles, since most company car drivers do most of their charging at home.

3. Claim Through Your Employer

Submit the mileage claim through the normal expenses process. The reimbursement runs through payroll but is not taxable and does not appear as earnings on the P11D — provided it sits at or below the advisory rate.

4. Switch to an Off-Peak Tariff

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

On a standard tariff, the HMRC rate lines up with actual cost — no surplus. On Octopus Intelligent Go, the gap is about 5p per business mile. The full tariff comparison has per-supplier rates.

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

Against a £40,000 petrol car at 30% BIK: £40,000 × 30% × 40% = £4,800 per year. The EV route saves £4,480 in annual tax.

The combination of low BIK, tax-free charging reimbursement, and cheap home electricity is what has driven the growth of EV salary sacrifice schemes.

Can Your Employer Pay for a Home Charger?

A grey area that depends on the specific arrangement:

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

Employer reimburses the employee for installation: Similar BIK position. Keep receipts and ensure correct payroll handling.

Employee buys the charger themselves: No BIK, but no tax relief either (unless self-employed).

The common route is for the employee to arrange and fund installation, and cover the cost over time through the ongoing HMRC advisory rate reimbursement — which, at off-peak rates, more than covers it.

Best Chargers for Company Car Drivers

Priorities shift slightly when the car is the employer's:

Ohme Home Pro (£535) — Widest Gap

Smart tariff integration keeps every session at the cheapest rate, widening the gap between actual cost and HMRC reimbursement. Per-session cost tracking in the app is useful evidence for expense claims.

Tesla Wall Connector (£478) — For Tesla Company Cars

The Model 3 and Model Y are among the most popular salary sacrifice cars. The Wall Connector pairs cleanly with the Tesla app, which logs every session with kWh and cost — handy for expense reporting.

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

The Hypervolt app exports per-session energy and cost data in a format that drops into most expense systems. Smart tariff support and solar compatibility round it out.

Key Dates and Rates to Know

We will update this post when HMRC publishes the June 2026 rates.

The EV tariff comparison, charger comparison, and UK EV Charging Cost Index carry the supporting numbers.