Workplace charging for all-electric and plug-in hybrid vehicles
12 July 2018
The draft Finance Bill 2018-19 includes the measure which removes any liability to income tax arising from the provision of charging facilities (including electricity) for individuals charging the batteries of vehicles other than taxable cars or vans at or near their workplace.
The clause introduces a new exemption to Chapter 3 of Part 4 of the Income Tax (Earnings and Pensions) Act 2003 (ITEPA) to encourage employers to provide charging facilities for all-electric and plug-in hybrid vehicles at or near the workplace.
As announced at Autumn Budget 2017, the exemption has effect from the start of the 2018-19 tax year onwards.
The clause also provides that:
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The exemption applies if the employee is a passenger in a vehicle using the charging facilities
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The charging facilities must be made available generally to the employer’s employees at that workplace. Where an employer has multiple workplace locations, they need not make charging facilities available at all of them
The legislation provides that the exemption can apply where facilities are made available “at or near the workplace”. The words “at or near the workplace” are not defined in the legislation. However, HMRC take the same approach as for parking facilities, where the charging facilities made available are within a reasonable distance from the place of work having regard to the nature of the locality.
The exemption does not extend to the reimbursement by employers of costs incurred by individuals or the provision of charging facilities when recharging vehicles away from the workplace. Where a vehicle is used in the performance of the duties of the employment, approved mileage allowance payments and mileage allowance relief may apply.
If you have any questions about this change or comments on the legislation, please contact Su McLean-Tooke on 03000 586404 or by email: [email protected] or [email protected].