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Advisory fuel rates for company cars

15th September 2020 | Written by In Accountancy | Categories : Limited Companies, News
Advisory fuel rates for company cars

New company car advisory fuel rates have been published which came into effect from 1 September 2020. The rates only apply to employees using a company car. The guidance states:

‘You can use the previous rates for up to one month from the date the new rates apply.’ 

The advisory fuel rates for journeys undertaken on or after 1 September 2020 are:

Engine sizePetrol
1400cc or less10p
1401cc – 2000cc12p
Over 2000cc17p
Engine sizeLPG
1400cc or less7p
1401cc – 2000cc8p
Over 2000cc12p
Engine sizeDiesel
1600cc or less8p
1601cc – 2000cc10p
Over 2000cc12p

HMRC guidance states that the rates only apply when you either:

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

You must not use these rates in any other circumstances.

The Advisory Electricity Rate for fully electric cars is 4 pence per mile. Electricity is not a fuel for car fuel benefit purposes.

If you would like to discuss your car policy, please contact us.

Internet link: GOV.UK AFR