E-Mobility in Payroll Practice: New Tax Rules Effective in 2026

Promoting electric mobility remains a key tool for the federal government in achieving its climate goals. To make Germany climate-neutral by 2045, extensive measures are necessary—including in the area of taxation. Section 3(46) of the German Income Tax Act (EStG) plays an important role in this regard, as it exempts certain benefits related to the charging of electric and hybrid electric vehicles from taxation. This provision has been in effect for several years and has been extended through December 31, 2030. Now, a recent letter from the Federal Ministry of Finance (BMF) dated November 11, 2025, introduces important changes that companies must take into account in their compensation practices starting January 1, 2026.

Tax exemption for charging at the employer’s premises remains in effect

As before, the free or discounted charging of a private electric or hybrid electric vehicle at a fixed company facility of the employer remains tax-exempt. This regulation applies not only to regular employees but also to temporary workers who are working at the hiring company’s premises. There is no restriction to specific vehicle types or a maximum number. Likewise, the corresponding benefits remain exempt from social security contributions.

If the monetary benefit for the private use of a company car is determined on a flat-rate basis via the 1-percent rule, the charging electricity provided by the employer is already accounted for. The tax exemption under Section 3 No. 46 of the Income Tax Act (EStG) has no additional effect in these cases. The situation is different if the monetary benefit is determined individually using a logbook. In this case, the electricity costs covered by the employer are not taken into account when calculating the total costs, provided they are tax-exempt.

Changes to the reimbursement of electricity costs

New: The previously permitted flat rates for the reimbursement of electricity costs that the employee personally incurred for charging a company-provided vehicle at home are no longer applicable. The familiar flat rates of 30 euros and 70 euros may only be used for pay periods ending before January 1, 2026. Instead, two new models for determining tax-free expense reimbursement will take effect.

Employees who also charge their company vehicle at home will be able to receive reimbursement for their actual electricity costs starting in 2026. The prerequisite is that the amount of electricity is accurately recorded using a separate electricity meter (stationary or mobile, e.g., in the wallbox or in the vehicle). The calculation is then based on the individually agreed-upon electricity price from the contract with the energy supplier—including the pro-rated base rate.

Alternatively, the employee may opt for a simplified solution: For the period from 2026 to 2030, the average electricity price for private households—published semi-annually by the Federal Statistical Office—may be used as a flat rate to determine electricity costs. This option is also permitted for dynamic electricity rates or for electricity from one’s own photovoltaic system and offers a certain degree of administrative relief.

What is changing for third-party charging facilities

The rule remains unchanged that charging at third-party locations—such as public charging stations—is generally not tax-exempt. However, the new BMF letter allows for some leeway here: If charging takes place at a charging station operated by a third party and the employer directly covers the costs, this may also be tax-exempt under certain conditions. The key factor is that the employer acts as the cost bearer and the electricity consumption can be verified.

Conclusion: New options, but also new administrative burdens

With the changes taking effect in 2026, the Federal Ministry of Finance is adapting the existing rules to technical developments in the field of electric mobility. This creates new flexibility for employers, particularly regarding the reimbursement of electricity costs for company vehicles charged privately. At the same time, however, the organizational burden also increases. The decision as to which reimbursement option is best for the individual employee can often only be made in hindsight—and therefore requires careful documentation.

Companies in Düsseldorf, Oberhausen, and the surrounding area that operate company car fleets with electric vehicles or are planning to switch to electric mobility should integrate the changes into their payroll accounting at an early stage. As tax advisors in Düsseldorf and Oberhausen, we are happy to assist you in implementing the new requirements—in a legally compliant, transparent manner, and tailored to your business processes.