HMRC changes EV reimbursement in latest Advisory Fuel Rates

There are new Advisory Fuel Rates (AFRs) available from HMRC, effective from 1 December 2025, which affect electric car reimbursement.

In the September quarter announcement, HMRC split the Advisory Electricity Rate (AER) in two separate rates. One for drivers that charge at home (8p) and one for those drivers who use public charging networks (14p).

For drivers charging at home, the 8 pence per mile rate has been reduced to 7p. Otherwise, all other rates remain untouched.

The split AER rates have proved troublesome for some fleets, according to the Association of Fleet Professionals (AFP). It wants further clarification on how to use the rates, saying some fleets are wary about implementing the higher charge and how to apportion payments.

Chair of the AFP, Paul Hollick, said: “We require clarification about the methodology and evidencing that is required, especially where it needs to be coded into existing systems. Almost no-one wants to go forward risking they’ll adopt the new AER regime incorrectly and face considerable tax back payments and even fines at some point in the future.”

Both the AFR and AER rates should be used for drivers that claim business mileage for their company car for their employer to reimburse them. Or if the company pays all fuel costs, for drivers to reimburse their company for private usage, thereby avoiding prohibitive Fuel Tax.

For hybrid and plug-in hybrid drivers, the relevant petrol or diesel rates apply.

For a recap on last quarter’s AFRs, go here. If you would like to discuss AFR and AER rates further, please contact fleet@cbvc.co.uk.

Latest HMRC Advisory Fuel Rates (as of 1 December 2025)