The period of two fuels is over. Diesel is waning as renewed low-CO2 tax incentives push firm automobile drivers to swap pumps for cost factors, however the tax system hasn’t saved up. HMRC nonetheless doesn’t deal with electrical energy as a gasoline, which might trigger pointless prices for electrified fleets. Right here’s keep away from them.
BEV milage charges – match for objective?
HMRC publishes Advisory Gasoline Charges (AFRs) for each quarter, grouped by engine dimension and gasoline kind and adjusted consistent with pump costs and common car effectivity. The Advisory Electrical Fee (AER) launched in 2018 gives one thing related for BEV drivers charging at house – the place it’s tougher to separate prices from the remainder of a utility invoice – however it’s nowhere close to as granular.
BEV effectivity is simply as variable as petrol or diesel vehicles – so an enormous SUV will price extra per mile than a metropolis automobile, however the AER doesn’t recognise this. Regardless of the latest improve from 4p/mile to 5p/mile resulting from rising power prices, it might probably depart drivers out of pocket even when they’re charging at house. And that’s even when they’re primarily based on the newest UK common power costs, from a 12 months in the past.
HMRC does provide some flexibility to cowl this. Fleets can repay drivers on a per-unit (kilowatt-hour) charge to cowl house charging or regulate the charges to match their prices, however it’s as much as them to show that the charges are reasonable. If an audit suggests the employer is making a revenue or successfully offering additional earnings to workers, then each are taxable.
Public charging presents barely completely different complications. Most networks will let drivers request a VAT receipt for bills, and a few gasoline playing cards now embrace chargepoint entry inside a single account too. Nevertheless, the quickest and most handy chargers are normally the most costly – for instance, Ionity’s prices 4 instances per unit because the UK home common – so it could possibly be price encouraging drivers to make a slight detour to maintain a lid on prices.
How do you incentivise PHEV drivers to plug in?
AFRs can be problematic for PHEVs, which don’t have their very own set of charges. As a substitute, drivers declare utilizing the petrol or diesel charges, primarily based on their engine capability, and these are unlikely to mirror hybrid economic system – not to mention a plug-in.
From 1 December 2021, the charges are as follows: