New Company Car Advisory Fuel Rates from 1st September

From 1st September 2013, new company car advisory fuel rates have taken effect.

According to HMRC: 'These rates apply to all journeys on or after 1 September 2013 until further notice. For one month from the date of change, employers may use either the previous or new current rates, as they choose. Employers may therefore make or require supplementary payments if they so wish, but are under no obligation to do either.'

As a result, the advisory fuel rates for journeys undertaken on or after 1 September 2013 are:

Engine Size Petrol LPG
1400cc or less 15p 10p
1401cc - 2000cc 18p (17p) 11p (12p)
Over 2000cc 26p (25p) 16p (18p)
Engine Size Diesel
1600cc or less 12p
1601cc - 2000cc 15p (14p)
Over 2000cc 18p

It should be noted that not all of the rates above have been amended. For those that have been amended, the amounts for the previous quarter are shown in brackets. Hybrid cars are treated as either petrol or diesel cars for this purpose.

Employers should also note that they do not need a dispensation to use these rates and that employees driving employer provided cars are not entitled to use these rates to claim tax relief if employers reimburse them at lower rates.

Employers should also note that the advisory rates are not binding where you can demonstrate that the cost of business travel in your employer provided cars is higher than the guideline mileage rates.However, you would have to agree this higher cost with HMRC under a dispensation.

For more information about company car advisory fuel rates, contact our tax experts or complete a quick enquiry form.

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