TMC updates reimbursement guidance for fleets running EVs and PHEVs
03 December 2018
Author: Sean Keywood
Fuel management company TMC has produced an updated guide to reimbursing drivers of company-run or grey fleet electric vehicles (EVs) and plug-in hybrid vehicles (PHEVs).
The revised guide, available from the firm's website, includes the new Advisory Electricity Rate (AER) introduced by HMRC for pure EVs in September.
The guide also follows the recent publication of TMC data showing many PHEVs cost more in fuel pence-per-mile than typical diesel or petrol company cars, because drivers don't charge them.
TMC managing director Paul Hollick said: "While the AER satisfied calls for a simple reimbursement rate for company car and cash allowance drivers of pure EVs, the extreme variability of PHEVs' fuel consumption sets them apart from both electric and combustion vehicles.
"Employers have the option of applying the appropriate AFR rates for petrol or diesel to PHEVs. But with PHEVs' fuel use varying by up to 300mpg depending on the drivers' journeys and charging practice, reimbursing for PHEV fuel at a flat rate will rarely be realistic or fair."
Hollick explained that there are alternatives to HMRC's advisory rates.
"With every type of drivetrain there is the option to reimburse fuel at actual cost (calculated from mileage and fuel purchase data).
"Or employers can set their own fuel rates, provided they are no higher than the relevant AFR, or can be substantiated if they are.
"In the meantime, the key point for businesses to keep in mind is that PHEVs offer a valuable bridge between combustion and fully-electric vehicles. Used correctly, PHEVs can deliver significant real-world operating cost savings.
"Our guide describes how to capture those savings by paying rates that fairly reflect PHEVs' real-world cost-per-mile potential, using methods that fully comply with the rules on fuel reimbursement."
TMC's guide also contains advice on settling claims for business mileage incurred by private plug-in owners, setting out how fleets can calculate the correct adjustments to AMAPs.
The guide also covers private use deductions for fuel card users.