HMRC advisory fuel rates for company car users from 1 September

HMRC has published the latest advisory fuel rates (AFR) for company car users, effective from 1 September 2019 cutting standard 1400cc plus mileage rates by 1p per mile to reflect lower fuel costs

The advisory fuel rates apply from 1 September 2019 have decreased by 1p per mile for 1401cc to 2000cc reflecting cuts in petrol and diesel prices over the last quarter, while LPG rate for 1401cc to 2000cc vehicles has risen 1p to 10p per mile. The previous rates, effective June 2019, can be used for up to one month from the date the new rates apply.

The rates only apply in the following circumstances:

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

These rates cannot be used in any other circumstances. If the rates are used, it is not necessary to apply for a dispensation to cover the payments made.

The advisory electricity rate for fully electric cars is unchanged at 4p per mile. Electricity is not a fuel for car fuel benefit purposes.

When employees are reimbursed for business travel in their company cars, HMRC will accept there is no taxable profit and no Class 1A national Insurance to pay.

Advisory fuel rates from 1 September 2019

Engine size

Petrol - amount per mile

LPG - amount per mile

1400cc or less

12p

8p

1401cc to 2000cc

14p

10p

Over 2000cc

21p

14p

 

Engine size

Diesel - amount per mile

1600cc or less

10p

1601cc to 2000cc

11p

Over 2000cc

14p

Hybrid cars are treated as either petrol or diesel cars for this purpose.

HMRC reviews rates quarterly on 1 March, 1 June, 1 September and 1 December.

Report by Sara White

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