Every 3 months, HMRC review the advisory fuel rates. They apply to employees using a company car if:
- You reimburse employees for business travel
- Or require employees to repay the cost of private travel
These are “fuel only” rates, and if you use them, you have certainty that you are claiming no more than the true cost of fuel used on business journeys and so will not be taxed on a ‘fuel benefit’.
Hybrid cars are treated as either petrol or diesel cars for advisory fuel rates.
These rates apply from 1st December 2020.
|Engine size||Petrol – amount per mile||LPG – amount per mile|
|1400cc or less||10p||7p|
|1401cc to 2000cc||11p||8p|
|Engine size||Diesel – amount per mile|
|1600cc or less||8p|
|1601cc to 2000cc||10p|
The advisory electricity rate for fully electric cars is 4p per mile.
Point Progress provides an HMRC Rate Update Service, to help businesses implement changes like these. Find out how MyExpenses can transform the management of your expenses. Or speak to your account manager to find out how to add the HMRC Rate Update Service onto your MyExpenses account.