Employers can use HMRC's Advisory Electricity Rate (AER), which is now reviewed quarterly, however, it does not accurately reflect genuine charging costs due to fluctuating tariff rates, leaving drivers short changed.
Employers can set their own mileage rates too, although it is still an inaccurate option and can incur Benefit in Kind (BIK) tax.
If employers choose to set their own rates they can pay employees more than the AER, but they must show proof to HMRC that they are covering actual costs, which can be challenging.
What's more, these rates will still be inaccurate as employees' tariff rates change often, once again, leaving employees underpaid for charging costs.
The simplest and most accurate method is to use Allstar Homecharge which monitors employees' tariff rates and accurately pays charging costs directly to employees' energy suppliers. Homecharge is also HMRC-compliant, meaning that there's no BiK tax to pay.
Allstar Homecharge alleviates administration headaches, removing the need for reimbursement and expense claims and drivers never have to pay a thing, making paying for EV charging costs simple*.
Join businesses across the UK getting their drivers' company EV charging costs paid for accurately with our EV charging solutions:
Payments are made direct to drivers' energy suppliers for EV home charging costs with Allstar Homecharge
Access the UK’s fastest dedicated business EV charge card network with Allstar One Electric
Accurate charging costs guaranteed with no admin costs
Drivers never pay a thing and all charging costs are rolled into a single invoice for the business.
* In order to comply with HMRC Vehicle Fuel benefit businesses may require a process to identify and reclaim payments for private use.