How to prove your home charging was solely for the company car
If you drive an electric company car and charge it at home, your employer can reimburse the cost of that electricity without you paying income tax or National Insurance on the payment. That's a clear win—no benefit-in-kind charge, and you don't pay twice for power you've already bought. But there's a condition, and it decides whether the reimbursement is tax-free at all.
HMRC's Employment Income Manual, at EIM23900, states: "Employers will need to ensure that the reimbursement made towards the cost of the electricity is solely for the company car."
That single word—solely—is doing all the work. It means the employer must be able to show that the money handed over corresponds to electricity that went into the company vehicle and nothing else. Not a mix of company and private car. Not an estimate. Not a share of the household bill. Solely.
This article explains what that requirement means in practice, why the household electricity bill can't meet it, and what kind of record will show the separation HMRC expects—without prescribing a meter, a method, or a certification that doesn't exist.
The legal framework: s.239(2) ITEPA 2003 and EIM23900
The exemption sits in section 239(2) of the Income Tax (Earnings and Pensions) Act 2003, which exempts payments in connection with a taxable company car. Electricity is excluded from the meaning of "fuel" for the car fuel benefit charge by s.149(4) ITEPA 2003, so the carve-out that would otherwise block that exemption falls away, and reimbursing the cost of charging the company car at home falls within s.239(2). HMRC confirmed this in its Employer Bulletin of October 2023 and amended EIM23900 accordingly. Until then it had treated the reimbursement as taxable earnings, and guidance written before that date still says so.
National Insurance follows the same path: the payments are disregarded in the earnings calculation (HMRC National Insurance Manual, NIM06440), so neither Class 1 nor Class 1A applies.
But the statute doesn't define how the employer should demonstrate that the electricity was used solely for the company car. That's where EIM23900 comes in. In practice, the exemption rests on three facts:
- The employee has a company car,
- The employee charges it at home and pays for that electricity through the domestic supply, and
- The employer reimburses the cost of that electricity—and only that electricity.
The guidance is explicit that the reimbursement must be "solely for the company car." It does not prescribe a particular meter, a particular software platform, or a certification scheme. What the employer needs is a way to show that the amount paid corresponds to the electricity consumed by the company vehicle and not by anything else.
Why the household electricity bill won't work
Most employees receive a monthly or quarterly bill from their energy supplier that shows total consumption in kilowatt-hours and the total cost. That bill includes lighting, heating, cooking, appliances—and any vehicle charging that happened to occur during the period.
The bill does not break out which kilowatt-hours went into which use. If you charge a company car at home, the energy used will appear somewhere in that total, but it won't be identified separately.
Some employers have tried to estimate a share—perhaps by comparing bills before and after the employee started charging at home, or by applying an average consumption figure. But an estimate of a share is not the same as demonstrating that a reimbursement was solely for the company car. If the bill covers household use, the exemption doesn't apply to a proportion; it applies to the actual cost of electricity used for the vehicle.
That's the first obstacle: the household meter and the energy contract treat all consumption as one stream.
Why the wallbox total isn't enough either
Most home wallboxes log cumulative energy dispensed. If you open the charger's app or web portal, you can usually see a running total in kilowatt-hours and sometimes a breakdown by session.
That looks promising—until you charge a second vehicle at the same wallbox.
If you have both a company car and a private car, or if a partner or family member plugs in their own vehicle, the wallbox total will include energy for all of them. The total no longer shows consumption solely for the company car; it shows consumption for whichever vehicle happened to be plugged in.
In that scenario, the wallbox data is better than the household bill, but it still doesn't meet the "solely" test unless there is only ever one vehicle charged at that wallbox and that vehicle is the company car.
For single-vehicle households with a dedicated company EV, a wallbox total can work. For everyone else, it doesn't separate what HMRC requires separated.
What "solely for the company car" means in practice
The condition is an outcome requirement, not a method prescription.
HMRC does not name a meter, an accuracy class, a device standard or a software platform. It says the reimbursement must be solely for the company car. How you demonstrate that is a matter of evidence, not regulation.
In practical terms, that means you need a record that:
- Identifies each charging session individually, showing the energy delivered (in kWh) and the date and time.
- Links each session to a specific vehicle, so it's clear which car was charged.
- Allows you to calculate the cost of that session, using either the employee's actual domestic electricity tariff or the employer's published reimbursement rate.
- Excludes sessions for other vehicles or other uses of the wallbox, if any exist.
If the record can do those four things, it provides the basis for an employer to reimburse solely the cost attributable to the company car. If it can't, the reimbursement will include something else—and the exemption won't apply.
The role of the charging record
A session-by-session log is the only practical way to show what the household bill and the wallbox total cannot: that a particular number of kilowatt-hours, on particular dates, went into a particular vehicle.
Many wallboxes and charge-management apps can produce such a log. The record typically shows:
- Date and time of the session,
- Energy delivered (kWh),
- Duration,
- Who started the session (an RFID card or a user profile), which links it to a vehicle.
If you charge two vehicles at home, the log should distinguish between them. If you charge only the company car, every session in the log will relate to that vehicle.
The employer uses that record to calculate the cost. If the employee's tariff is, for example, 28p per kWh, and the log shows 350 kWh in the month attributable to the company car, the reimbursement is £98. That £98 corresponds solely to energy used for the company car, and the exemption applies.
HMRC does not require the log to come from a particular type of device or a certified platform. It does not say the meter must be separately calibrated or that the wallbox must meet any particular technical standard for tax purposes. What matters is that the record supports the conclusion that the amount reimbursed was solely for the company vehicle.
What HMRC does not require
There is no prescribed equipment. EIM23900 does not mention meters, wallboxes, apps, or certification. The condition is solely about the purpose and amount of the reimbursement, not the method of capture.
There is no approval scheme. HMRC does not approve software, does not certify reports and keeps no list of acceptable devices, so no product carries an official seal for this exemption. The exemption in s.239(2) ITEPA 2003 attaches to the payment, not to the platform that produced the evidence.
There is no obligation to install a second electricity meter. Some employees do install a dedicated supply for the garage or car port, but that's a choice, not a condition of the tax exemption. If the charging record separates company car sessions from everything else, a single meter and a single energy contract are fine.
What HMRC does require is that the reimbursement is solely for the company car, and the employer needs something to show it. That will almost always be a record that shows which sessions belong to which vehicle.
The tariff: actual cost, not a rate per mile
The exemption covers reimbursement of the cost of the electricity. That cost depends on what the employee actually pays per kilowatt-hour on their domestic tariff.
If the employee is on a tariff at 24p per kWh, and the charging log shows 300 kWh for the company car, the cost is £72.
HMRC's Advisory Electricity Rate is a different route, not a simpler version of the same one. It reimburses business mileage in a company car—from 1 June 2026, 7p per mile for home charging and 15p per mile for public charging—and is based on a mileage log, not on kWh. It says nothing about how much electricity went into the car at home. Reimbursing the actual cost of home charging has no cap and is not limited to business miles, but it depends on being able to show the electricity was for the company car.
For the purpose of this article—showing that home charging was solely for the company car—we are concerned with actual reimbursement of electricity cost, which means kWh multiplied by tariff.
Multi-vehicle households: where the separation fails
If you charge both a company car and a private car at the same wallbox, the wallbox total will include both. The household electricity bill certainly includes both. Neither gives you a figure that is solely for the company car.
The way to separate them is a record that ties each charging session to the car that was plugged in. In practice that usually means authorising each session per driver—an RFID card or a separate user profile for each person using the wallbox—so the session log shows whose car was charging. Not every wallbox supports this, so it is worth checking before relying on it.
If the record cannot tell the vehicles apart, the employer cannot show that the reimbursement was solely for the company car—and the exemption depends on exactly that.
This is where many home charging arrangements come unstuck. The technology on the electricity supply side—the meter, the contract, the bill—treats all consumption as one. Only the charging equipment or the management software can split it by vehicle.
Record keeping and employer duties
The employer is responsible for ensuring that the reimbursement is solely for the company car. In practice, that means the employer needs to see evidence before making the payment.
Most schemes work like this:
- The employee submits a monthly report showing charging sessions for the company car, total kWh, and the tariff rate.
- The employer (or payroll) checks that the report separates company car sessions from any private vehicle or household use.
- The employer calculates the reimbursement (kWh × tariff) and pays it through payroll or as an expense claim.
- The payment is treated as exempt under s.239(2) ITEPA 2003, so no tax or National Insurance is deducted.
- The employer keeps the submitted records in case HMRC asks to see them during a compliance check.
HMRC does not publish a mandated retention period specifically for EIM23900 records, but the general rule for PAYE records is three years after the end of the tax year to which they relate. Keeping the charging logs and tariff evidence for that period is prudent.
The records do not need to be submitted to HMRC in advance, and there is no approval process. They are simply evidence that supports the exemption the employer is claiming.
What a good record looks like
A record that supports the "solely for the company car" requirement will typically include:
- Session-level detail: each charging event logged separately, with start and end time, energy delivered, and vehicle identifier.
- Vehicle separation: if more than one car is charged at the wallbox, each session is tagged with the correct vehicle, so company car sessions can be isolated.
- Tariff documentation: a copy of the employee's energy contract or tariff schedule, showing the per-kWh rate used to calculate reimbursement.
- Monthly summary: total kWh for the company car in the period, total cost, and the amount claimed.
The format is less important than the content. A CSV export from a wallbox app, a PDF report from a charge-management platform, or even a manually maintained spreadsheet (if supported by session receipts or app screenshots) can all work, provided they show the separation clearly.
What doesn't work is a single aggregate figure—total kWh for the month with no breakdown—or a bill that includes household consumption alongside vehicle charging.
Automated reporting and why it matters
Session-by-session logs can be generated manually, but most employees find that impractical. Logging into a wallbox app after each charge, taking a screenshot, noting the kWh, and compiling a monthly spreadsheet is time-consuming and error-prone.
That's why many fleets and employees turn to automated reporting tools. These systems connect to the wallbox (or the vehicle's telematics), pull session data automatically, apply the employee's tariff, and generate a monthly report that isolates company car consumption.
The automation doesn't change the legal test—"solely for the company car" still means the same thing—but it makes compliance practical at scale. For an employer with fifty or a hundred company EVs, manual logs are not sustainable. An automated platform that tags sessions by vehicle and produces audit-ready reports is.
HMRC does not approve platforms, so no platform carries its seal. But a platform that captures session-level data, separates vehicles and documents the tariff produces the evidence the "solely" condition in EIM23900 calls for.
Common mistakes and how to avoid them
Reimbursing a fixed monthly amount without a usage record. If the employer pays £80 every month regardless of actual charging, that's a round-sum allowance, not a reimbursement of cost. It's taxable.
Using the household bill as evidence. The bill shows total consumption, not consumption solely for the company car. Unless the household has no other electrical load (impossible) and no other vehicle (uncommon), the bill doesn't separate what needs to be separated.
Claiming the wallbox total when two vehicles share it. If both a company car and a private car charge at the same wallbox, the wallbox's cumulative kWh includes both. Without session-level separation, the total doesn't prove "solely."
Assuming a particular type of meter is required. HMRC does not require a calibrated meter, an MID meter, or a sub-meter. Those may be useful for other reasons, but they are not a condition of the s.239(2) exemption. The condition is evidence of sole use, not a particular measurement device.
A worked example
Emma drives a fully electric company car. She has a 7kW wallbox at home. She also owns a private plug-in hybrid, which her partner drives. Both vehicles charge at the same wallbox.
Emma and her partner each have their own RFID card for the wallbox, and every session is logged against the card that started it.
At the end of March, the app shows:
- Emma's card (company car): 18 sessions, 312 kWh total
- Partner's card (private PHEV): 9 sessions, 87 kWh total
Emma's domestic electricity tariff is 26p per kWh.
Cost attributable solely to the company car: 312 kWh × £0.26 = £81.12.
Emma submits the session log and a screenshot of her tariff schedule to her employer. The employer reimburses £81.12 through payroll, coded as exempt under s.239(2). No tax, no National Insurance.
If Emma had submitted the wallbox total (399 kWh) without separating the two vehicles, the reimbursement would have included electricity for the private car, and the exemption would not apply.
Why this matters for employers
The benefit-in-kind charge for a battery-electric company car is still low compared with petrol and diesel cars, but employees still prefer not to pay for electricity out of their own pocket. Reimbursing home charging cost-neutralises one of the practical obstacles to EV adoption.
But if the reimbursement is taxable, the saving disappears. An employee in the 40 per cent band who receives £100 taxable reimbursement pays £40 income tax plus National Insurance; the net benefit may be less than the electricity actually cost.
The s.239(2) exemption makes reimbursement efficient, but only if the employer can show the payment was solely for the company car. That, in turn, requires a record that separates company vehicle charging from everything else the household consumes.
For employers running a company car scheme with multiple EVs, the choice is between building that record-keeping capability in-house or using a platform that automates it. Either way, the legal test is the same: solely for the company car.
Section 149(4) and the fuel benefit charge
One related point: under s.149(4) ITEPA 2003, electricity is not "fuel" for the purpose of the car fuel benefit charge. That means if the employer provides electricity for a company car—whether at the workplace, at a public charger via a payment card, or by reimbursing home charging—there is no fuel benefit charge.
The two provisions work together: s.149(4) keeps electricity out of the fuel benefit charge, and that is what lets s.239(2) exempt the reimbursement payment.
The effect is that company car drivers can charge at work or at home, with employer support, and pay no tax on the electricity—provided, in the case of home reimbursement, that the amount is solely for the company car.
What this article does not cover
This article focuses on the tax treatment of reimbursement for home charging under s.239(2) ITEPA 2003 and the "solely for the company car" test in EIM23900. It does not address:
- The benefit-in-kind calculation for the company car itself (governed by Chapter 6, Part 3 ITEPA 2003 and the car benefit charge tables).
- The Advisory Electricity Rate for business mileage, beyond the distinction above.
- VAT treatment of electricity or charging equipment.
- Employer provision of a wallbox as a benefit in kind.
- Charging at the workplace or at public charge points (which may be exempt or relieved under different provisions).
For those topics, separate guidance applies.
About ChargeReport
ChargeReport reads every charging session from supported wallboxes and turns it into a monthly statement—each session with date, time and kWh, plus the monthly total—which evidences the separation HMRC asks for, in a form payroll can file. Learn more at chargereport.app.