Better Fleet: Why EV reimbursement is still unclear for fleets

April 7, 2026

As fleets go electric, one basic question keeps causing confusion: who pays for the electricity used on business journeys, and how do they get that money back fairly?

That’s what reimbursement means in practice. An employee charges a company vehicle at home or on the road for work, then the employer pays them back for that business travel. With petrol and diesel, that process is pretty settled. With EVs, it isn’t.

The reason is simple. Electricity doesn’t have one standard price. A driver charging cheaply at home overnight might pay a fraction of what another driver pays using a rapid charger during the working day. Workplace, kerbside and public charging all add even more variation.

HMRC gives fleets a framework through Advisory Electricity Rates (AER). From March 2026, that’s 7p per mile for home charging and 15p per mile for public charging. It helps from a tax point of view, but it doesn’t always reflect what drivers are actually paying.

Steve Tigar, CEO of loveelectric, puts it clearly:

“HMRC’s decision to split the Advisory Electricity Rate is a step in the right direction, but it still misses the mark in some important areas. Most notably, it does not account for the high cost of rapid charging. For employees who need to rely on rapid chargers during business trips, the 14p per mile allowance falls far short of the true cost.”

That’s where things start to break down. If the rate’s too low, drivers are covering company costs themselves. If it’s too high, the business loses control of spend. Steve sums up the wider issue:

“This mismatch shows why a one-size-fits-all advisory rate cannot deliver fairness or efficiency.”

There’s also a practical knock-on effect. If drivers know rapid charging will leave them out of pocket, they’ll often avoid it. That can mean detouring to cheaper chargers, spending longer charging, or making decisions based on cost rather than getting the job done efficiently.

And once that becomes a regular issue, it stops being a finance problem and starts becoming a people problem:

“When employees are effectively subsidising business travel to the tune of hundreds of pounds each year, the consequences extend well beyond frustration with expenses.”