HMRC has updated its Advisory Fuel Rates (AFRs) – the rates employers use to reimburse employees for business travel in company cars. 

From 1 September 2025, there are now two separate rates for fully electric vehicles, depending on where the car is charged: 

• Charged at home: 8p per mile 

• Charged using public chargers: 14p per mile 

AFRs are reviewed every quarter. They help employers and employees: 

• Reimburse business mileage costs in company cars. 

• Work out the VAT element of business fuel. 

• Calculate repayments when employees reimburse their employer for private fuel use. 

What’s new 

HMRC has added extra guidance for electric vehicles: 

• If the actual cost per mile of using a public charger is higher than the AFR, you can use a higher rate – as long as you can prove the cost was higher (for example, with receipts or calculations). 

• If a car is charged at both home and public locations, the mileage can be split proportionally between the two rates. This split should be worked out on a fair and reasonable basis. 

If your business provides company cars or reimburses mileage, it’s important to apply the correct rate and keep good records – especially now that electric vehicle charging costs can vary significantly.