The latest HMRC advisory fuel rates for petrol, diesel, LPG, and electric company cars have now come into effect. These rates are updated quarterly by HMRC and serve as a standard reference for UK businesses when reimbursing drivers for business mileage or calculating repayments for private fuel use.
Advisory fuel rates (AFRs) are set by HMRC and are commonly used by employers to manage company car fuel reimbursements. Although employers may use alternative rates if they have sufficient justification, adopting the official HMRC AFRs is the simplest and safest option. Paying employees no more than the published rates ensures no taxable benefit arises and eliminates National Insurance liabilities.
HMRC reviews and revises these rates every quarter on 1 March, 1 June, 1 September, and 1 December to reflect changes in fuel costs.
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It is important to note that AFRs apply exclusively to company cars. For employees using their personal vehicles for business travel, the approved mileage allowance payment (AMAP) rates are applicable instead.
The current advisory fuel rates are as follows:
-
Petrol cars:
- Engines up to 1400cc: 14p per mile (unchanged)
- Engines between 1401cc and 2000cc: 17p per mile (unchanged)
- Engines over 2000cc: 27p per mile (up from 26p)
-
Diesel cars:
- Engines up to 1600cc: 15p per mile (unchanged)
- Engines between 1601cc and 2000cc: 16p per mile (down from 17p)
- Engines over 2000cc: 22p per mile (down from 23p)
-
LPG cars:
- Engines up to 1400cc: 11p per mile (unchanged)
- Engines between 1401cc and 2000cc: 13p per mile (unchanged)
- Engines over 2000cc: 20p per mile (unchanged)
-
Electric cars charged at home: 7p per mile (unchanged)
Employers and employees alike should ensure they are using the most current rates to maintain compliance and correct reimbursement practices.