Supplies of public EV charging and VAT

In a highly significant decision, the FTT has held that, contrary to HMRC's explicit guidance, supplies made by a provider of electricity to electric vehicle (EV) owners at public charging points (CPs) is, in principle, subject to the VAT reduced rate of 5% for supplies of domestic fuel: Charge My Street Limited v HMRC [2026] UKFTT 318. The FTT accepted the taxpayer's argument that these supplies fell within the scope of Note 5(g) to VATA 1994 Schedule 7A Group 1 as deemed domestic supplies.

However, where such supplies were made via third party apps on terms that provided that the EV charging supplies were made by the app, then those supplies fell outside the scope of Note 5(g) due to the de minimis threshold contained in that provision.

Background

Charge My Street Ltd (CMS) made supplies of electricity to customer's EV's at various sites in the north of England. It typically did not own the locations where the charging stations were located, but entered into arrangements with the owners of those locations.

Supplies of electricity for domestic use are subjected to a lower, 5% rate of VAT by VATA 1994 Schedule 7A Group 1. Note 5 of Group 1 deems certain supplies, including certain supplies of electricity, to be for "domestic use". In particular, Note 5(g) covers: "a supply of electricity to a person at any premises where the electricity (together with any other electricity provided to him at the premises by the same supplier) was not provided at a rate exceeding 1000 kilowatt hours a month".

CMS contended that its supplies to customers fell within the scope of Note 5(g) and made a claim to recover overpaid output VAT. HMRC denied that claim and pointed to its own guidance stating the public charging of EVs was subject to VAT at the standard rate (VAT Notice 701/19).

CMS argued that its supplies fell within the scope of Note 5(g) and were therefore treated as domestic supplies of electricity subject to the 5% rate. It argued that all of the requirements of Note 5(g) were met: (a) supplies are made "to a person", the driver, (b) the supplies are made at its CPs in public places, and so are made "at any premises", and (c) the supplies made to a single driver at the same premises (the relevant CP) in a single month do not exceed 1,000 kWh such that they are not provided at "a rate" exceeding 1000 kilowatt hours a month.

HMRC argued that the supplies were not supplied "to a person at any premises" as this requires that supplies are made to premises, in the form of a building, which are the premises of the recipient of the supplies. The supplies were not made to the recipient's premises, as they are made in public places, and in some cases are not made to any premises at all as they are made at locations, such as car parks, which do not comprise a building.

In addition, HMRC contested CMS' approach to the "rate" at which supplies of electricity are made. It was wrong to equate "the rate" with the quantity of electricity supplied during a whole month. Rather, the rate at which supplies are made must be measured over the period during which the relevant supply actually takes place. In relation to "ad hoc" supplies such as those made by CMS, the rate must be measured over the short period of, at most, a day during which each supply takes place. The rate applicable to a period of one day is 33 kWh (1,000 kWh divided by the days in the month).

FTT decision

The FTT has concluded that the supplies by CMS of electricity to charge EV vehicles are public CPs was subject to the lower, 5% rate of VAT. On the plain, natural meaning of Note 5(g), in principle, supplies of EV charging made by CMS to drivers, at CPs, fell within the ambit of Note 5(g).

On its plain, natural meaning, the requirement is that electricity is supplied to an identified person at identified premises. The FTT rejected HMRC's argument that this requirement is satisfied only if the relevant premises have some nexus or connection with the relevant person. Nor was there any justification for interpreting the words "any premises", as confined to buildings. On its ordinary meaning, as construed in the immediate and overall context in which it is used, premises means any identifiable property, which may include buildings but also a defined public area such as a car park.

Moreover, given the history of the provision, it was reasonable to suppose that the legislature intended to capture in Note 5 supplies of fuel and power which are not readily identifiable as being for "domestic use", without investigation and/or monitoring, but which due to their nature, as regards the type of fuel/power and that they are not made for re-sale or due to the limited amounts they are supplied in, are unlikely to be supplied to a person other than a domestic final consumer to what is considered to be a material extent.

Who were the supplies to?

It was accepted that where drivers paid with a contactless card or other direct forms of payment, the supplies were to the drivers. However, HMRC argued that in many cases the supplies of electricity were not made to the driver, but to an intervening "third party app" used by the driver. In addition, many drivers used an app, Fuuse, that was part of the same business as CMS. In those cases, HMRC argued that CMS supplied the app provider with electricity which on-supplied it to the driver. As such, the 1000kWh de minimis was breached and the supplies did not fall within Note 5(g).

On this point, the FTT concluded that the agreement between CMS and Fuuse was one simply for software services and did not affect the supplies of electricity from CMS directly to drivers. This was despite the fact that the contractual arrangements stated that Fuuse provided customers with EV charging services. In economic and commercial reality, that contractual provision was not correct taking into account the full contractual arrangements and how they operated in practice.

However, the FTT did agree with HMRC that in the case of "third party apps", it was the apps who provided the supply of charging to drivers. The contractual terms between (a) CMS and the "third-party app", and (b) the "third party app" and the drivers, in each case indicated that the "third-party app" acted either as principal or as a commission agen, in providing EV charging to the drivers. This was underscored by the fact that, under each of these arrangements, the "third-party app" had the scope to make a profit as regards its role due to the pricing arrangements. The "third party app" plainly played an economic role in the arrangements. The fact that the "third-party apps" did not own the charging infrastructure and did not directly receive supplies of electricity from the ultimate supplier did not preclude them from contracting with drivers to be the supplier of EV charging services (as principal) and then using a charge point operator (CPO) (such as CMS) to fulfil their contract or to act as the CPO's agent in making the supplies to the driver.

Comment

The decision would appear to bring into line the VAT treatment of home charging of EV vehicles and public charging of such vehicles at least where the supply is made direct from the CPO to the driver. (And whilst it does not apply to the supply from the CPO to a third party app intermediary, it may well apply to the on-supply by the intermediary to the driver.) However, as the decision is contrary to HMRC's published guidance and position on public EV charging, it seems inevitable that HMRC will seek to appeal the decision.

The public policy behind the current inequality in treatment between home and public charging seems hard to justify (except from an exchequer perspective). As the appellant argued in this case: "Domestic car users who do not have off-street parking and so cannot access EV charging from their home are, in effect, penalised financially, making it more difficult for them to transition to an electric car... using their home electricity supply, EV drivers can get energy for approximately 7p per kWh and incur VAT at a rate of 5%. In public, rapid EV CPs in some cases charge 80p or more per kWh and are subject to VAT at 20% according to HMRC... although it is not necessarily always the case that wealthier people always have off-street parking at home, it is more likely given that the larger a home, the more likely it is that it will have off-street parking, thereby enabling EV charging from the home electricity supply, and... essentially, this inequality could mean that the transition to EVs will be paid for by people who can least afford it."

There are suggestions that HM Treasury has been discussing the possibility of a cut to VAT on public EV charging from 20% to 5%, aligning it with the domestic rate, especially given the proposed introduction of a pay-per-mile levy due to begin in 2028. Perhaps this FTT decision will concentrate Treasury minds on this particular topic.