In brief
When someone charges a company car at home, the employer can reimburse the electricity costs tax-free. This can be done through monthly flat rates or proof of actual consumption.
How does the flat rate work?
The tax authorities allow monthly flat-rate amounts. Their level depends on whether charging is also available at the employer's premises and whether the vehicle is fully electric or a hybrid. The applicable amounts follow the tax authorities' guidance and should be agreed with a tax adviser before use.
The advantage is that no evidence for individual charging sessions is needed.
When is consumption-based reimbursement worthwhile?
For high mileage. Drivers who regularly cover long distances electrically can incur costs well above the flat rate, leaving them to pay the difference. Proof requires a wallbox with a calibrated meter that records electricity charged to the specific vehicle.
What matters in implementation?
The connection to payroll. Expense reimbursement is processed through salary payments and must reach payroll each month with a clear link to the person and supporting evidence. Manually collecting charging data creates recurring work for larger fleets that can consume the savings compared with public charging.
Tax rules in this area change more often than in others. Agree on the chosen approach with a tax adviser and document its basis so it can be explained during a payroll tax audit.
Further reading
Fleet Management Without Excel Spreadsheets
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