A UK First‑tier Tribunal has ruled that public EV charging can qualify for the 5% reduced VAT rate if the supply does not exceed 1,000 kWh per customer per month at a specific location, overturning HMRC’s earlier stance. The decision could lower charging costs and may influence the Treasury’s consideration to cut VAT on public charging to 5% ahead of the 2028 pay‑per‑mile levy. HMRC’s 2021 guidance still applies a 20% rate to public charge points, and the Treasury is reviewing VAT reforms to offset the levy’s impact.
The Tribunal ruled that if the electricity supplied at a public charge point does not exceed 1,000 kWh per customer per month at a specific location, it can be treated as domestic consumption and qualify for the 5% rate.
HMRC’s 2021 guidance stated that the de minimis provision does not apply to public charge points, so the standard 20% VAT rate applies, whereas the tribunal ruling allows a 5% rate under certain conditions.
The levy is set at 3p per mile for fully electric vehicles and 1.5p per mile for plug‑in hybrids, potentially adding about £255 per year to an average EV driver’s running costs.
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The UK First‑Tier Tribunal Tax Chamber ruled that public electric‑vehicle charging supplies qualify for the reduced 5% VAT rate, not the standard 20% rate, if the electricity supplied does not exceed 1,000 kWh per customer per month. The decision, delivered in late February 2026, could lower charging costs and requires HMRC to update guidance if the government does not appeal.
