VAT and Charging Electric Vehicles
Updated: Jun 18
Confused on when VAT can be reclaimed for charging an electric car for business purposes? You're not alone. HMRC have recently tried to clarify....
Revenue and Customer Brief 7 (2021) was issued at the end of May. Here are the key points:
Supplies of electric vehicle charging through charging points in public places are charged at the standard rate of VAT. There is no exemption or relief that reduces the rate of VAT charged.
If you are a Sole Trader, charge your electric vehicle at home and charge it for business purposes you can reclaim the VAT at the rate at which it was supplied for the business use part.
A business cannot recover VAT when an employee charges an electric car at home (because the electricity supply is made to the employee and not the business)
A business can recover the VAT on the electricity supply when the employee charges the business electric car at the business premises. The business either recovers all the input VAT and becomes liable for an output tax charge on the private use element; or, recover VAT on the business element only (much simpler!).
Read the full brief here
The information contained within in this article is provided for informational purposes only and is not intended to substitute for obtaining accounting, tax, or financial advice specific to your own circumstances from your own adviser.