Fleet Management Cost Calculator 2025/26

HMRC advisory fuel rate for fully electric company cars: 7p per mile from September 2023 (updated quarterly). This rate is used when an employer reimburses an employee for business mileage in a company EV, or when an employee repays the cost of private fuel in a company EV. The rate is lower than petrol/diesel advisory rates (14-20p/mile) reflecting EV's lower running costs. Using the HMRC rate avoids the need to keep fuel receipts for reimbursement purposes.

Operating leases (contract hire) give the most predictable total cost — fixed monthly rate covers depreciation, maintenance and sometimes insurance; no residual value risk; and full VAT reclaim on 50% of car lease cost (100% for vans). Outright purchase or HP avoids monthly payments and gives asset ownership but concentrates residual value risk. Finance leases are common for fleets wanting off-balance-sheet treatment. HMRC capital allowances differ by vehicle: main rate (18%) for most cars; 100% first-year allowance for qualifying zero-emission vehicles.

All fleet vehicles must carry at minimum third-party liability insurance under the Road Traffic Act 1988. Most business fleets use comprehensive cover. Fleet policies covering 5+ vehicles typically offer better rates than individual vehicle policies, single-named driver flexibility, and a fleet excess structure. Motor fleet insurance average premium 2025: £500-£1,500 per vehicle depending on vehicle type, driver age profile, claims history and usage. Telematics-based fleet insurance can reduce premiums by 10-25% for low-risk fleets with good driving data.