Payroll update: New Advisory Fuel Rates from 1 September 2019

Published: Friday 20 September 2019

HMRC has announced new Advisory Fuel Rates for use from 1 September 2019.  

The rates apply when you reimburse employees for business travel in their company cars.  If you pay an amount up to the level of the Advisory Rate, HMRC deem there is no tax or Class 1As due.

The rates also apply if employees are required to repay the cost of fuel used for private travel back to the employer.  If the employees pay a minimum of the Advisory Rate, HMRC will accept there is no fuel benefit charge. 

You can use the old rates up until the end of September, then you must apply the new rates.

 Engine size Petrol - amount per mile  LPG - amount per mile 
1400cc or less  12 pence  8 pence 
1401cc to 2000cc  14 pence  10 pence 
Over 2000cc  21 pence  14 pence 

 

 Engine size Diesel - amount per mile 
1600cc or less  10 pence 
1601cc to 2000cc  11 pence 
Over 2000cc  14 pence 

 

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

The Advisory Electricity Rate for fully electric cars is 4 pence per mile.

Electricity is not a fuel for car fuel benefit purposes.

For more information, visit HMRC’s website: https://www.gov.uk/government/publications/advisory-fuel-rates.
 

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Cheryl Baker
Cheryl Baker
Payroll Solutions Associate Director
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