As an owner-managed business, navigating the transition to electric vehicles isn't just about sustainability; it's about optimising your tax efficiency. In this blog, we'll unravel the world of electric car charging, tailored specifically for owner-managed businesses, considering whether the car is owned personally or by the business and if it is charged at home or the office.

This is a simplified version of the HMRC guide EIM23900 - Car benefit: special cases: issues relating to electric cars.

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First of all here are some tips:

·     When you own the car you can continue to charge 45p per mile

·     When the company owns the car the approved mileage rate is 9p per mile - this is almost definitely too low given charging prices 😡

·     Another nice tip is your employer can provide a charge card up to the value of £100

·     You can now reclaim the cost of charging your car at home from your employer (including private and mixed use) -previously private and mixed use mileage would lead to additional taxes due

Key thing is to be able to prove the electric cost relates to YOUR company car

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Here are some scenarios and by answering yes or know you can understand the tax implications of charging your car and the company paying for charging costs.

Scenario 1

Employee chargers’ the car at home and the electricity is provided by employer meaning they have a meter at your house for this purpose (unlikely in practice).

Scenario 2

Employee charges their car at home and their employer reimburses the electricity costs.

Scenario 3

The employee charger the car at work.

In conclusion, the transition to electric vehicles for owner-managed businesses isn't solely about embracing sustainability; it's a strategic move that can significantly impact tax efficiency. Navigating the complexities of EV charging, whether the car is personally or business-owned and where it's charged, is crucial. This knowledge empowers owner-managed businesses to navigate the EV landscape with financial caution and eco-consciousness in mind.

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