So you’ve bought an electric company car – what can the company pay for?
So you’ve bought an electric company car – what can the company pay for?
You can legitimately put most EV-related business costs through the books, just keep business and personal use clearly recorded to avoid unnecessary BIK tax.
August 18, 2025

Switching to an electric company car is not only better for the environment, it can also be tax-efficient for both you and your limited company. But once the paperwork’s signed and the EV is on your driveway, there’s one big question:

What can the company actually pay for without creating a nasty tax surprise? Let’s break it down:

1. Charging costs

The company can pay for:

  • Public charging for business trips
  • Workplace charging points (installation & running costs – exempt from Benefits In Kind (BIK) for all use)
  • Home charging costs for business miles – reimbursed at HMRC’s Advisory Electric Rate (currently 7p per mile) or if your charging unit at home can provide a report showing the usage this can also be used to reimburse you.

2. Maintenance & servicing

Fully allowable if the company owns or leases the car:

  • Annual service and MOT (if applicable)
  • Tyres (including winter tyres)
  • Brake fluid, wipers, bulbs
  • Paid software updates

3. Accessories & equipment

If needed for business use, your company can cover:

  • Charging cables/adaptors
  • Roof racks/storage (for work equipment)
  • Home wallbox charger (if the company owns the car) – but personal use could trigger BIK unless it’s agreed as part of the company’s EV scheme

4. Insurance & roadside assistance

The company can pay for:

  • Comprehensive insurance (with business cover)
  • Breakdown recovery (including EV specialist services)

5. Parking, tolls & congestion charges

  • Covered if incurred during business travel.

What the company can’t pay without tax implications

Some costs will be treated as a taxable benefit if covered by the company:

  • Electricity for private mileage (unless reimbursed to the company)
  • Fines & penalties (parking tickets, speeding fines)
  • Personal upgrades (e.g., premium sound system, private plates)

With a UK limited company, you can legitimately put most EV-related business costs through the books – from the car itself to charging, insurance, and maintenance. Just keep business and personal use clearly recorded to avoid unnecessary BIK tax. If you have any questions, don’t hesitate to get in touch. 

The information contained in this article is based on the opinion of Hive Business and does not constitute formal tax advice. Any tax outcomes will be based on individual circumstances, tax legislation and regulation, which are subject to change in the future. You should seek specific advice before embarking on any course of action. Hive Business does not provide regulated Financial Advice, including advice on investment, insurance or lending products or their suitability for you. This article is provided for information only and does not constitute, and should not be interpreted as, investment advice or a recommendation to buy, sell or otherwise transact, or not transact, in any investment including Bitcoin and other crypto. Any use you wish to make of any information contained within this article is, therefore, entirely at your own risk.

By Thomas Julier Head of Accountancy Production
If you have any questions or comments about this article, please get in touch.
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