HMRC revises its new AER expenses rates for EV drivers


HMRC has admitted to a miscalculation in its newly-published advisory electricity rates (AER) for electric company cars. Since September 1, drivers have separate reimbursement rates for home and public charging, replacing the single pence per mile (ppm) rate previously used.

The home charging rate remains at 8ppm, but the public charging rate rises to 14ppm after HMRC corrected its initial figure of 12ppm. The revision is based on an average efficiency of 3.59 miles per kWh and an electricity cost of 51p per kWh, drawn from Zapmap’s public charging price index and ONS data.

HMRC stressed that higher rates than the AER may be claimed if businesses can evidence higher charging costs, such as at ultra-fast chargers. Industry leaders welcomed the change, saying separate rates for home and public charging better reflect real-world costs and will make expense claims simpler and fairer for both fleets and drivers.

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What is AER?

'AER' is the Advisory Electricity Rate, a Government-recommended pence-per-mile reimbursement for drivers using company electric vehicles. 
Fleet drivers are employees who use vehicles for commercial purposes, and the AER is intended to compensate them for the electricity costs of charging their electric company cars or vans.
T
he AER has been criticised for failing to keep pace with actual charging costs, especially for those using public rapid chargers, potentially leaving drivers out of pocket. 

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