25/06/2026
Interesting question for you:
There are a lot more Electric Vehicles ('EVs') on our roads, these days.
Now, suppose you get a travel allowance (source code 3701 in your IRP5) and want to claim for business travel using the deemed cost per km rate in the table contained in the public notice (see below).
If you bear the full cost for fuel, is electricity “fuel” for purposes of EV owners claiming for business travel against a travel allowance?
The relevant portion of paragraph 2 of the attached Notice provides as follows:
“2. Determination of rate per kilometre
The rate per kilometre referred to in section 8(1)(b)(ii) and (iii) must...be determined in accordance with the cost scale set out in paragraph 3, and must be the sum of—
(a) the fixed cost divided by the total distance in kilometres (for both private and business purposes) shown to have been travelled in the vehicle during the year of assessment…
(b) where the recipient of the allowance has borne the full cost of the fuel used in the vehicle, the fuel cost…”
In light of the fact that EVs are powered by electricity rather than petrol or diesel, the following questions arise:
Whether electricity may be regarded as “fuel” for purposes of section 8(1)(b)(ii) and the gazetted table; and
Consequently, whether an EV owner would be entitled to claim the “fuel cost per kilometre” as reflected in the table.
Given that “fuel” is not defined in the Income Tax Act, its ordinary grammatical meaning would need to be considered.
On this basis, it could be argued that electricity does indeed constitute “fuel” in the context of EVs for purposes of section 8(1)(b)(ii).
Your thoughts?
