I've a company electric car which I charge at home etc. How much can my employer pay me for business mileage

I've a company electric car which I charge at...

Didn't find your answer?

I've a company electric car which I charge at home etc. How much can my employer pay me for business mileage

Replies (19)

Please login or register to join the discussion.

the sea otter
By memyself-eye
09th May 2012 12:10

presumably 45p/mile

As the initial cost is higher than an equivilant Infernal Combustion engine even though the running costs are lower - interesting question though, I'm thinking of buying a Renault Twizzy.

Thanks (0)
avatar
By dnicholson
09th May 2012 12:20

Car charging costs

I don't know the correct answer as far as HMRC are concerned, but if it is based on the actual cost it's nowhere near as much as a conventional car.

I drive a Nissan Leaf and a full charge costs about £2.90. This is under 4p per mile for the expected 75 mile range. Obviously the 45p includes depreciation, service, etc., which are relevant also.

I'd be interested to know whether there's an official answer.

Thanks (0)
avatar
By Discountants
09th May 2012 12:21

If it's a company car...

If it's a company car then usually you would use advisory fuel rates: http://www.hmrc.gov.uk/cars/advisory_fuel_current.htm

However as you can see there is no fuel advisory rate for electric cars.

Your best bet would be for the company to pay the entirety of your recharging costs and have a fuel benefit in kind using the zero-emmission rate of 0%.

That said I think that HMRC are probably behind the curve with thinking about zero-emmision vehicles.

Thanks (0)
By Steve Kesby
09th May 2012 12:51

I agree (up to a point) with Discountants

It's a company car and so the 45p rate doesn't apply.  In the absence of an advisory rate (and frankly the published figures for electric cars seem to vary widely anyway), you can only claim actual costs.

There can't be a fuel benefit though, not because the relevant percentage is 0%, but because S.149(4) ITEPA 2003 says that a faciility or means of recharging an electric vehicle isn't fuel.  The flipside of that is that if the employer pays for the private element of your recharging it might be earnings or a benefit, dependent on how the arrangements are made.

You need to calculate the cost of the electricity used to recharge your car and then how many miles you travel on the charge and how many of those are business. Do you do an awful lot of business miles in a car that only gets recharged at home?

@memyself-eye Are you planning on getting the optional doors with your Twizy? If you're putting it through a company, when you have to start calculating a benefit for it in a few years time, I'd say that the separately leased battery is an "accessory" for which you will need to determine a list price.

Thanks (0)
By Jamie Roberts
09th May 2012 12:57

Yes agree AMAP would apply provided it was my own car and could be classed as a car per S235 per ITEPA235

However this is a company car. Can't find any Revenue guidance on what I can claim, if I charge the car at home or elsewhere other than at my employer's premises.

Surley there are other company cars out there?

Thanks (0)
By Jamie Roberts
09th May 2012 13:22

Apolgies for spelling/refs in my last post, trying to multi task.

 

Found this

 

http://www.fleetnews.co.uk/news/2011/12/12/electric-vehicle-fuel-reimbursement-rates-don-t-add-up-/41779/

Thanks (0)
the sea otter
By memyself-eye
10th May 2012 10:12

Isn't the battery lease

a monthly charge to the P&L?

I think i've decided it's too cold in England to drive around in a Twizy - with added doors or no. :)

Thanks (0)
By Steve Kesby
10th May 2012 10:48

Battery Leasing

Yes, it's a revenue expense. However the car benefit rules say that you apply the relevant percentage to the list price of the car plus the list price of accessories (something made available for use with the car and attached to it).

Just as if you leased a car, you would still apply the relevant percentage to the list price of the car, you need to include the list price (notional or actual) of the leased battery, which is required to actually be able to use the car and presumably attached to it.

They do look rather like they've bolted two Segway's together.

I thought it was a clever pricing strategy from Renault though.

Thanks (0)
avatar
By Bob Long
11th May 2012 11:34

Surely this is also affected by the "commuting" element of the mileage used?

Thanks (0)
avatar
By chris.cpwtax.co.uk
11th May 2012 11:39

Battery Leasing

I would have to take issue with the idea that a battery is an accessory.  If you do not have one, all you have is a stationary metal sculpture !!

Thanks (0)
avatar
By brian.barrett
11th May 2012 11:40

Are we trying to be too complicated here?

Without looking at whether private mileage can be obtain free etc., surely isn't it simply a case of:

- workout cost per mile for recharging, and multiply by appropriate business miles (keep log etc.)

- claim money from employer

- on tax return add money from employer and then remove as an expense incurred, ".. wholly and necessarily ..." for performing your job.

I would think there are published data as to how many KWatts it takes per mile and that it should be acceptable to use that information if you do not have a power usage meter when you are charging your car.

Thanks (0)
avatar
By aburt01
11th May 2012 11:54

Twizy

I would have to check the Twizy carefully, i.e. with few calls to HMRC, since I believe it is a Quadricycle.

Telegraph.co.uk and others "...Weighing just 450kg including its 100kg battery pack, Twizy qualifies as an L7e quadricycle under EU regulations."

In other words, it is not, strickly speaking, a car.

 

Thanks (0)
By Steve Kesby
11th May 2012 12:34

Yes but...

A quadricycle is a car for car benefit purposes.

The car benefit legislation defines a car as "a mechanically propelled road vehicle, other than:

a goods vehicle (you can barely get a packed lunch in a Twizy),an invalid carriage (RTA 1988 unladen weight ≤ 254Kg),a motorcycle (RTA 1988 ≤ 3 wheels & ≤ 410kg)a vehicle of a type not commonly used as a private vehicle and unsuitable for such use."

A quadricycle doesn't fit into any of those exclusions.

There's no need to phone HMRC. It's in their manuals.

The same definition of car applies for capital allowances purposes and it says at CA23510 that "Quadricycles (quadbikes) do not meet the definition of a 'motorcycle'. If they are road vehicles within the definition above then they will be treated as cars for capital allowances purposes."

Thanks (0)
avatar
By DMGbus
11th May 2012 13:23

Good to be a "car" as Zero BIK on Electric Cars

" The appropriate percentage for type E cars is 0% for 2010–11 to 2014–15 inclusive. Thereafter it reverts to the normal appropriate percentage for type E: 9%.  "

So, good to be a "car".

A "type E" car is...

"

Zero emission cars (including electric cars only)

 "

Above is text lifted from guidance CA33.

http://www.hmrc.gov.uk/guidance/2011/ca33.pdf

 

Thanks (0)
avatar
By DMGbus
11th May 2012 13:27

Battery is NOT an accessory

If the battery is essential for the operation of the vehicle it cannnot possibly be an "accessory" as it is NOT an add-on.    Just like a fuel tank is not an accessory on a petrol or diesel car.

Academic really until 6 April 2015 as zero BIK. on electric-only cars.

Thanks (0)
By Steve Kesby
11th May 2012 14:03

Oops
Double-post

Thanks (0)
By Steve Kesby
11th May 2012 14:28

The problem with electric cars

Is that in 2015/16 the rate will be 13% and in 2015/16 onwards it will be 15% as per the 2012 Budget documentation. See the 4th page of the ootlar appendix. This means that from 2015/16 you're probably better off with something that runs on fossil fuel with low emissions, but has a lower list price (after taking account of what's included in the price and what needs to be included as an accessory).

Renault's list price for the Twizy doesn't include the battery, which is then separately leased from Renault Finance. If they did the same thing with the fuel tank of their petrol or diesel cars, you would then need to add in the (notional or actual) list price of that fuel tank as an accessory.

Accessory isn't just the dictionary definition, it's defined in ITEPA as "any kind of equipment made available for use with the car and attached to it".

Where the battery (or fuel tank), is made available under a separate arrangement from the rest of the car, it satisfies the definition of "non-standard accessory".

Or are you suggesting that it should be entirely excluded, simply because of Renault's clever pricing/financing arrangement?

Thanks (0)
avatar
By DMGbus
11th May 2012 21:02

Correction - accessory - Renault

I'd overlooked the fact that to disguise the battery cost Renault with two models of electric car sell the car incomplete without a battery.  In these circumstasnces as the list price excludes an essential component I regard the cost of that component as an accessory to add on the car list price.

The Twizzy and Fluence are the two car models that this applies to, with a lease or rental agreement as a "hidden extra" for the battery...

(note that fuel cost - as in Electricity - is said to be 3.5 hours on charge for an upto 50 miles range - if it's a 3 KW charger then this looks like 10,5 KWH of charge or 10.5 units of electricity which at 12p per unit (some suppliiers cost less than this) means £1.26 for upto 50 miles of driving - or about 2.5p per mile.

...

http://www.autoexpress.co.uk/videos/featurevideos/283225/renault_twizy_video_review.html?DCMP=NLC-Newsletters&utm_campaign=autoexpressvideo_newsletter&utm_medium=email&utm_source=newsletter

 ...

and

...

http://www.autoexpress.co.uk/videos/featurevideos/283225/renault_twizy_video_review.html?DCMP=NLC-Newsletters

Thanks (0)
avatar
By Greg Christen
31st Mar 2014 10:50

Due to increase in pollution rate, now everybody consious about the protection of the environment. For that reason the automobile companies are develop the concept of electric car. Electric cars are useful to reduce the impact of pollution into the environment. By using of electric cars the natural resources will be save for future period of time. As per the above article if the owner provide electric cars for use of employees then he should not be charge any price for that. Because the employees are using the car for office purpose. If they use the car for personal purpose then the owner should charge the price for that.

Audi Repair Chatsworth

Thanks (0)