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HMRC yet to confirm if investment in EV charging qualifies for super-deduction

20 April 2021

In the Budget 2021, the Treasury confirmed that fleets purchasing new heavy and light commercial vehicles could benefit from a 130% super-deduction tax relief.

The super deduction applies to ‘main rate expenditure’, whilst a 50% special rate first-year allowance (FYA) will apply for ‘special rate expenditure’. 

Whilst it was made clear that company cars would not qualify for the tax relief, qualification for businesses investing in electric vehicle (EV) charging infrastructure was not definitely confirmed. HMRC said that it would be a case-by-case decision. 

Capital expenditure on EV charging points and other associated installation costs currently qualify for 100% FYA – an offer which expired on March 31, 2023.

A spokesperson for HMRC said, “Provided the electric vehicle charging infrastructure is plant or machinery, critical consideration will then need to be given as to whether the expenditure is main rate or special rate expenditure.”

“Generally speaking, integral features of buildings and structures and long-life assets are special rate.

“Electrical systems are included in the definition of integral features so this will need to be considered on the particular facts of the case as to whether the electric vehicle charging infrastructure is an integral feature of a structure or building.”

Chair of the Association of Fleet Professionals (AFP) Paul Hollick told the News at 10 webinar, hosted by Fleet News, that the super-deduction could be applied to electric vehicle workplace charge points, and might also apply to home chargers for staff and employees, funded by the company. The AFP is still waiting on confirmation from HMRC as to whether it also includes the cost of the groundworks to install the kit. 

If EV chargers and installation does qualify for the super-deduction, it could encourage businesses to invest. James McKemey, Head of insights at Pod Point - our business partner - said that “firms must be profitable to be generating corporation tax bills, and not all are, but for those who are, this can act as a potent incentive to start providing charging infrastructure”.

We at Marshall Leasing are always interested in the latest news about schemes which assist those people responsible for fleets, and trust that you find this information useful. If you would like assistance from our team of experts, please get in touch with us at info@marshall-leasing.co.uk or by calling 01480 414541. 

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