Advisory fuel rates from 1 December 2017

HMRC has published updated advisory fuel rates (AFRs) which will apply from 1 December 2017, alongside guidance on when to use them and how the rates are calculated.

 

AFRs are the rates employers can use to reimburse employees who pay to put petrol in their company cars when using them for business. The rates have not changed greatly but a few of them have gone down.

 

The rates depend on engine size and are different for petrol, diesel and LPG. Hybrid cars are treated as either petrol or diesel cars for this purpose.

 

These rates apply from 1 December 2017 until further notice. For one month from the date of change, employers may use either the previous or the current rates.

 

Engine size

Petrol - amount per mile

LPG - amount per mile

1400cc or less

11 pence

7 pence

1401cc to 2000cc

14 pence

9 pence

Over 2000cc

21 pence

14 pence

Engine size

Diesel - amount per mile

1600cc or less

9 pence

1601cc to 2000cc

11 pence

Over 2000cc

13 pence

 

Advisory fuel rates are intended to reflect actual average fuel costs and are updated quarterly. They can be used by employers who:

 

  • reimburse employees for business travel in their company cars, or
  • require employees to repay the cost of fuel used for private travel

 

Where employers pay a rate per mile for business travel no higher than the advisory fuel rates for the particular engine size and fuel type, HMRC accepts that there is no taxable profit and no Class 1A NIC to pay.

Anonymous