Advisory Fuel Rates For Company Cars

22 December 2011

New company car advisory fuel rates have been published to take effect from 1 December 2011

New company car advisory fuel rates have been published to take effect from 1 December 2011. HMRC website states: 

 

'These rates apply to all journeys on or after 1 December 2011 until further notice, allowing them to reflect fuel prices more quickly. 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 theyso wish, but are under no obligation to do either. ' 

 

The advisory fuel rates for journeys undertaken on or after 1 December 2011 are: 

Engine size                          Petrol                            Diesel                               LPG

1400cc or less                    15p (15p)                                                                10p (11p)

1401cc - 2000cc                 18p (18p)                                                                12p (12p)

Over 2000cc                         26p (26p)                                                                18p (18p)        

1600cc or less                                                           12p (12p)

1601cc - 2000cc                                                        15p (15p)

Over 2000cc                                                                18p (18p)

 

Please note that most rates have not changed. However, the rate for LPG cars reduced for those with an engine size of 1400cc or less.

 

Other points to be aware of about the advisory fuel rates:

  • Employers do not need a dispensation to use these rates.
  • Employees drving employer provided cars are not entitled to use these rates to claim tax relief if employres reimburse them at lower rates. Such claims should be based on the actual costs incurred. 
  • The advisory rates are not binding where an employer can demonstrate that the cost of business travel in employer provided cars is higher than the guidline milage rates. The higher cose would need to be agreed with HMRC under a dispensation. 

 

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