EV charging changes
More and more businesses are seeing the benefit in switching to EV. And, with many employees now charging their vehicles on the road, at home, and at the office, the use of EV charging points is becoming more common in public places.HMRC has answered the requests from businesses to clarify the rules in specific cases, and in particular to confirm when input tax can be recovered when charging electric vehicles for business purposes.
As electric vehicle adoption continues to grow across UK fleets, businesses should also keep abreast of the latest guidance around VAT recovery, employee reimbursement and public charging.
The key information from this latest brief
- Where an employee charges an electric vehicle at home, the electricity supply is generally made to the employee rather than the employer. As a result, businesses are typically unable to recover VAT on domestic electricity costs incurred by employees, even where charging relates to business use.
- Where employees charge an employer-provided electric vehicle at the employer's premises, accurate records should be maintained to distinguish between business and private use. VAT recovery remains subject to the normal input tax rules and is generally limited to the business-use proportion.
- HMRC’s policy on petrol and diesel is unchanged. It is still the case that VAT recovery is allowed when an employee fills up their car and is reimbursed by their employer.
HMRC says that it is possible to recover the input tax for charging an EV as an individual if all the following apply:
- You are a sole proprietor
- You charge your electric vehicle at home
- You charge your electric vehicle for business purposes
Sole traders should maintain clear records of business use, charging costs and supporting VAT documentation when recovering input tax.
2026 update on public EV charging VAT
A First-tier Tribunal ruling in 2026 challenged HMRC's long-standing position that electricity supplied through public EV charging points should always attract the standard VAT rate. HMRC has applied to appeal the decision and continues to maintain its existing policy, meaning businesses should continue to monitor developments in this area.
Workplace charging
Any business, charity, or public sector organisation with a Companies House reference number can apply for the Workplace Charging Scheme, or WCS grant if they can declare a need for electric car charging equipment, or an intent to encourage EV use among their staff or fleet.
The WCS can provide financial support towards the up-front costs of buying and installing electric car chargers for many businesses, charities, and public sector organisations.
As EV adoption increases, workplace charging is becoming an important part of both fleet management and employee benefit strategies. Businesses should regularly review charging capacity, utilisation and future requirements to ensure infrastructure keeps pace with demand.
Employer Checklist
To help manage EV charging effectively, employers should:
- review EV charging and reimbursement policies regularly
- maintain accurate business mileage records
- document VAT recovery processes
- monitor developments in public charging VAT rules
- assess future workplace charging requirements
- align EV strategies with wider sustainability objectives
Need guidance?
Understanding EV charging, VAT recovery and reimbursement rules can be complex, particularly as legislation and HMRC guidance continue to evolve. If you'd like advice on managing EV charging within your business, contact our team for tailored guidance and support.
