In the previous edition of this newsletter we showed HMRC’s Advisory Fuel Rates (AFRs) applicable from 1 September 2025. You may have noticed that there was a new rate for fully electric vehicles that are charged using public charging facilities. This means that we now have two electric car rates, which from 1 September are as follows:
Where vehicle charged at home: 8p per mile
Where vehicle charged using public chargers: 14p per mile
Updated quarterly, AFRs assist employers in reimbursing employees for fuel costs incurred during business travel in company cars. They’re also used to calculate the VAT element of business fuel. Additionally, employees may use these rates to repay their employer for the cost of any private fuel usage.
The following updates have been made to HMRC’s AFR guidance:
- If the cost per mile of a public charger exceeds the AFR, employers or employees may use a higher rate, provided they can show the cost per mile was higher.
- For journeys where a company car is charged at both public and residential locations, you may apportion the mileage to reflect the proportion of charging at each location.
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- Any apportionment should be carried out on a fair and reasonable basis.
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