Charging an electric company car: what you need to know

With the important focus on achieving Net Zero goals and targeting personal emissions, more and more company cars seem to be following the electric car trend.

This also comes with the added benefit of avoiding the extra costs associated with volatile fuel prices.

Whilst having an electric company car can be a great perk for employees, both employers and employees need to be aware of the tax implications associated with the vehicle.  

Is tax due on charge points?

As with paying for fuel for a petrol/diesel car, it is common for employers to cover the cost of charging electric cars, or to provide charging points.

The way in which this is structured is set to impact whether tax is due.

If the employer provides a charging point on or near the company premises, no taxable benefit is due for the car, which also covers private use of the car.

This is also extended to the charging of an electric vehicle that is owned by the employee, providing that other employees can use the charging point as well.

There may also be the possibility for employers to save money on the initial installation of workplace charging points through the Workplace Charging Scheme.

In the circumstance that the employer supplies a charging point to be based at the employee’s home, there is no taxable benefit when the car is used for work-related purposes, however it is due for private use.

Finally, should the employer provide payment for the employee to charge their company car, no taxable benefit is due. Whereas, if the employee owns the car, the taxable benefit is due on the cost of the charging.

Employees may be eligible to apply for the Electric Vehicle Homecharge Scheme, which is a grant contributing up to 75 per cent of the installation of a charge point.

Need advice on recognising your tax obligations? Contact our experts today.