ATO finalises its guidance on calculating electric vehicle home charging costs

The Australian Taxation Office has finalised the Practical Compliance Guideline 2024/2 to help individuals and employers calculate the electricity costs of charging electric vehicles at home.

The surge in electric vehicle (EV) adoption, fueled by their favourable fringe benefits tax (FBT) treatment, presents a new challenge for both individuals and employers in managing their tax obligations. One complexity that has emerged is calculating the cost of charging EVs at home; information that is not usually separately identifiable from the household’s total electricity consumption. The Australian Taxation Office (ATO) has now finalised the Practical Compliance Guideline (PCG) 2024/2, addressing this issue by providing taxpayers with a practical method to calculate their home charging electricity costs.

For calculating the cost of charging the EV at home, the guideline provides taxpayers with the option of either using a rate of 4.20 cents per kilometre (the EV Home Charging Rate) or the much more involved option of calculating the actual cost incurred. Taxpayers must use the same method for the entire year, however can choose different methods for each car or in subsequent years.

The PCG only applies to zero-emissions vehicles that are solely fuelled by electric power. It does not apply to plug-in hybrid vehicles that use a combination of petrol and electricity, nor does it apply to electric motorcycles or scooters.

The PCG applies retrospectively for Fringe Benefits Tax (FBT) years commencing on or after 1 April 2022 and Income Tax years from 1 July 2022, impacting both employers and individual taxpayers.


Despite the FBT exemption available for eligible EVs, employers still have an obligation to calculate the taxable value of the benefit provided so they can report the employee’s reportable fringe benefit amount (RFBA).

Additionally, any amounts paid by the employee towards the EV, including home charging costs, will reduce the taxable fringe benefit or the RFBA.

Therefore, the PCG is relevant for employers who have provided an employee with any of the following specifically relating to an EV:

  • Car fringe benefit – Including through a novated lease arrangement
  • Expense payment fringe benefit – Such as reimbursements for EV home charging costs
  • Residual fringe benefit – private usage of EVs that are designed to carry a load of one tonne or more or nine or more passengers

Individual taxpayers

The PCG will apply to individuals who use their EVs to gain or produce assessable income and incur electricity costs to charge their EVs at home.

Individuals with EVs can now use the EV Home Charging Rate when calculating the deduction available for work-related car expenditure under the logbook method. The calculated cost of charging the EV at home is then included with all other car expenses incurred during the year (e.g. insurance, registration and repairs and maintenance, depreciation) before apportioning the total for the work-related usage. The guideline does not apply to those claiming the cents per kilometre method.

Individuals using the PCG method must keep odometer records and a home electricity bill to show evidence that they have incurred electricity costs during the year. This is in addition to the usual record-keeping requirements under the logbook method, such as holding a valid logbook and keeping written evidence of all costs incurred.

Complexities in calculating the home charging kilometres

In many circumstances, EVs won’t just be charged at home. They will also be charged at either free or paid commercial charging stations. The PCG acknowledges this complexity and addresses it by providing taxpayers with an approach to determining the charging costs in scenarios where the home charging percentage can and can’t be accurately determined.

1. Home charging percentage can be accurately determined

Some EVs can report the percentage of the vehicle’s total charge from different types of charging locations. In this case, taxpayers can calculate their home charging costs using this data, applying the EV Home Charging Rate to the portion of kilometres that were charged at home.

2. Home charging percentage cannot be accurately determined

Where the EV doesn’t have the capability to report this percentage, and the taxpayer has incurred costs for charging both at commercial charging stations and at home, taxpayers can either:

  • Use the EV Home Charging Rate for all kilometres travelled and disregard any commercial charging station costs paid during the period or
  • Use only the costs incurred at commercial charging stations and disregard the PCG’s method of calculating the home electricity costs.

Initially released in draft form in March 2023, the PCG’s recent finalisation comes right in time for the end of the 2024 FBT year. It provides a welcomed practical approach for taxpayers needing to determine their own or their employees’ home charging costs.

Although this simplifies the compliance burden for taxpayers, those who rely on the PCG should ensure that they understand and correctly apply the method while maintaining the required records. If you are an individual who uses their EV for work or an employer who needs assistance with their fringe benefits tax obligations, please get in touch with your Mazars advisor or one of our experts below for more guidance.

Brisbane – Matthew Beasley

Melbourne – Liliana Harris

Sydney – Dean Newman

+61 7 3218 3900

+61 3 9252 0800

+61 2 9922 1166

Author: Adrian Citton

* mandatory fields

Your personal data is collected by Mazars in Australia, the data controller, in accordance with applicable laws and regulations. Fields marked with an asterisk are required. If any required field is left blank, it will not be possible to process your request. Your personal data is collected for the purpose of processing your request.

You have a right to access, correct and erase your data, and a right to object to or limit the processing of your data. You also have a right to data portability and the right to provide guidance on what happens to your data after your death. Finally, you have the right to lodge a complaint with a supervisory authority and a right not to be the subject of a decision based exclusively on automated processing, including profiling, that produces legal effects concerning you or significantly affects you in a similar way.

Published: 16/02/2024

All rights reserved. This publication in whole or in part may not be reproduced, distributed or used in any manner whatsoever without the express prior and written consent of Mazars, except for the use of brief quotations in the press, in social media or in another communication tool, as long as Mazars and the source of the publication are duly mentioned. In all cases, Mazars’ intellectual property rights are protected and the Mazars Group shall not be liable for any use of this publication by third parties, either with or without Mazars’ prior authorisation. Also please note that this publication is intended to provide a general summary and should not be relied upon as a substitute for personal advice. Content is accurate as at the date published.