Electric cars and the mileage rate: three countries, three answers

Update, April 2026: the UK approved rate for cars and vans rose from 45p to 55p a mile for the first 10,000 business miles. The 25p rate above that, and the 5p passenger payment, are unchanged. This post describes the position as it stood when it was written.

An approved mileage rate is meant to approximate the cost of running a car. Electric cars broke that approximation, and three countries have patched it three different ways.

Britain: the same rate, and no questions

For a car you own, HMRC applies the approved mileage rates regardless of what is under the bonnet. An electric car gets 45p for the first 10,000 business miles and 25p after, exactly as a petrol one does.

Since the rate is built around the running costs of an average petrol car, and an electric car charged at home costs a fraction of that per mile in energy, this is quietly one of the better deals in the system. The driver keeps the difference.

The important caveat is that this applies to your own car. A company electric car is reimbursed at the advisory electricity rate, which is far lower and is meant to cover electricity alone, because the company is already carrying the rest of the cost. Claiming the approved rate on a company EV is a common and expensive error.

Ireland: file it under a petrol engine

Ireland's civil service rates band by engine capacity, which an electric car does not have. Rather than build a new band, Ireland assigns electric vehicles to one of the middle engine capacity bands.

It is a workaround and it is honest about being one. The effect is that an Irish EV driver is paid as though running a mid-sized petrol car, which is roughly the intent, arrived at by administrative convenience rather than measurement.

France: an uplift, on purpose

France applies its barème kilométrique and then increases the resulting figure for an electric vehicle.

This is the only one of the three that is explicitly not a costing exercise. An electric car costs less per kilometre in energy, so a cost based approach would pay it less. France pays it more, deliberately, as an incentive.

It is worth being clear about that, because it is the opposite of what the rate is nominally for. France has decided the barème can carry a policy goal as well as a cost estimate.

The three, side by side

The bit that catches everyone

In all three, the trap is the same and it is not the rate. It is the distinction between a car you own and a car your employer provides.

The approved rate, the civil service rate and the barème are all about a vehicle you own and run. A car provided by your employer is a different animal in every one of these systems, reimbursed at a lower fuel or energy only figure, because the employer is already paying for the vehicle.

People who move from their own car to a company car, or the reverse, tend to carry the old rate with them for a year without noticing. On an EV the gap between the two figures is unusually wide, so the error is unusually expensive.

What to record

Nothing changes. Date, destination, purpose, distance, at the time.

What does change is that your real cost per mile is now genuinely knowable, because charging is metered in a way petrol at a pump is not. If you log what you actually pay to charge, you can see the gap between what a mile costs you and what it is worth in a claim. On a home charged EV in Britain that gap is currently the largest it is anywhere in the system.

Sources

• Travel, mileage and fuel rates and allowances (HMRC)
• Expenses and benefits: business travel mileage, rules for tax (HMRC)
• Civil service rates (Revenue)
• Frais de transport (impots.gouv.fr)
• Simulateur du barème kilométrique (impots.gouv.fr)

General information for drivers in the UK, Ireland and France, not tax advice. Rates and uplifts change: check the current figures with the authority you file under.