New Advisory Fuel Rates

A new set of Advisory Fuel Rates came into effect from the beginning of December 2019, which apply to employees who use a company car.

The rates can be used in circumstances where you are reimbursing employees for business travel in their company car or in requiring employees to repay the cost of fuel used for private journeys. If you use these rates, you will not need to seek a dispensation to cover the payments.

The new rates are:

Engine size Petrol – amount per mile LPG – amount per mile Diesel – amount per mile
1400cc or less 12 pence 8 pence 9 pence
1401cc to 2000cc 14 pence 9 pence 11 pence
Over 2000cc 21 pence 14 pence 14 pence

Hybrid cars are treated as either petrol or diesel cars for the purposes of Advisory Fuel Rates.

Meanwhile, the Advisory Electricity Rate for fully electric cars is 4 pence per mile, although electricity is not considered a fuel for car fuel benefit purposes.

Link: HMRC advisory fuel rates for company car users from 1 December

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