The 14p Public-Charging Rate Is Not a Cap: What Payroll Must Evidence

For business journeys made between 1 December 2025 and 28 February 2026, HMRC's advisory electric rates for fully electric company cars are 7 pence per mile for home charging and 14 pence per mile for public charging.

The 14p public-charging rate is not a statutory ceiling. HMRC says an employer can use a higher amount when it can show that the fuel cost per mile is higher. That flexibility creates a control decision for Finance and Payroll: a claim above 14p should not be approved simply because the employee used an expensive charger.

The employer needs a supportable cost-per-mile case.

This article covers only reimbursement of business mileage in fully electric company cars. It does not cover employee-owned cars, vans, hybrids, private mileage, ordinary commuting or home-charger installation. HMRC treats hybrid company cars as petrol or diesel cars for Advisory Fuel Rates.

What HMRC's rule actually changes

HMRC's Advisory Fuel Rates guidance says the rates apply only to employees using a company car. Employers may use them to reimburse business travel in that car or to calculate repayment for private fuel. They must not be used in other circumstances.

For company-car business travel, HMRC draws a clear line:

• at or below the relevant advisory rate, there is no taxable profit and no Class 1A National Insurance to pay

• above the advisory rate, the employer can still use its own rate if it can show that the fuel cost per mile is higher

• if the employer pays above the advisory rate but cannot show the higher fuel cost per mile, the excess must be treated as taxable profit and as earnings for Class 1 National Insurance purposes

  So the payroll question is not, “Did this charging session cost more than usual?” It is, “Can we show that the electricity cost per mile for this claim was higher than 14p?”

A receipt can be key evidence, but it is not the whole decision

A public-charging receipt or invoice may show the operator, location, date, energy supplied, price per kilowatt-hour and total paid. That establishes what the charging session cost. On its own, it does not establish:

• that the vehicle was a fully electric company car

• that the mileage was a qualifying business journey

• how the charging cost became a cost per mile

• how much of the charge related to the claimed business mileage

• whether the rate and policy in force on the journey date were used

  HMRC does not prescribe a single evidence template on the Advisory Fuel Rates page. The following is therefore a practical control design, not an HMRC form or certification.

The evidence file for a claim above 14p

Finance and Payroll should be able to retrieve one coherent record containing:

The cost-per-mile calculation must connect the charging evidence to a supportable mileage cost. One possible method is to divide the evidenced electricity price per kilowatt-hour by a documented miles-per-kilowatt-hour figure for the vehicle. Another may be more appropriate if the employer has reliable vehicle or charge-card data. Whichever method is used, record the source, assumptions and calculation consistently.

Do not treat the charger's price per kilowatt-hour as though it were already a mileage rate. And do not infer that every mile in a claim was public-charged merely because one public receipt exists.

Mixed home and public charging needs an apportionment rule

HMRC says that, where a company car is charged at both public and residential locations, mileage can be apportioned according to how much charging happens at each place. The calculation should be fair and reasonable.

That means a policy should define how the split is produced and checked. It might use charge-card data, vehicle data or another consistent record. A claimant's unsupported estimate should be treated as an exception, not silently converted into 100% public-charged mileage.

The evidence should let a reviewer reproduce three numbers:

1. eligible business miles

2. the home/public allocation of those miles

3. the rate applied to each allocation

A four-route Payroll decision

Under a policy that uses the advisory rate as its default, every in-scope claim can be routed through the same four outcomes.

1. Pay at 14p

Use this route when the journey falls within scope, public charging is supported and no higher cost-per-mile case is being made.

2. Pay above 14p with evidence

Use this route when the employer's documented calculation shows a public-charging cost per mile above 14p. Retain the calculation, source evidence and approval with the claim.

3. Route the unsupported excess for tax and National Insurance treatment

If the employer chooses to pay above 14p without evidence that the fuel cost per mile is higher, HMRC says the excess is taxable profit and earnings for Class 1 National Insurance purposes. Payroll should not code the whole payment as though the advisory-rate treatment automatically applied.

4. Reject or return an out-of-scope claim

Employee-owned vehicles, vans, hybrids and non-business mileage need their own policy route. They should not enter the fully electric company-car process merely because electricity was purchased.

Keep the record, not just the reimbursement total

GOV.UK's expenses and benefits record-keeping guidance says employers must record the date and details of expenses or benefits, the information needed to calculate reported amounts and employee contributions. For reimbursed travel, it says to keep when and why the employee travelled and, where possible, receipts as evidence. Records must be kept for three years from the end of the tax year to which they relate.

HMRC's employer compliance guidance for travel expenses adds that employers are expected to operate systems that identify the travel expenses paid and show that payments were treated correctly. Records may be paper or electronic, but the supporting expense form and receipt should be retained together where both exist.

A payroll total without the journey, charging, calculation and approval trail is therefore not enough to explain why a higher rate was used.

The policy sentence to fix now

Avoid writing, “Public charging is reimbursed at a maximum of 14p per mile.” That turns an advisory rate into a hard internal cap and may leave employees carrying an evidenced higher business cost.

Under that chosen reimbursement design, a clearer policy rule is:

Public-charged business mileage in a fully electric company car is reimbursed at the HMRC advisory rate in force on the journey date. A higher rate may be approved only where the employer can evidence a higher electricity cost per mile; unsupported excess payments are referred to Payroll for the appropriate tax and National Insurance treatment.

That sentence does not remove judgement. It makes the evidence threshold and escalation route explicit.

Put the rule into an operating pack

Turn the rate, evidence fields, approval route and Payroll exception treatment into one controlled process with the Company EV Reimbursement Pack.