By RAM Tracking on 27 Aug 2024
Advisory Fuel Rates (AFRs) are rates set by HMRC to guide companies on the amount they can reimburse employees for fuel costs when they use company cars for business travel. These rates are crucial for employers and employees, ensuring fair compensation without incurring tax liabilities.
AFRs apply to various types of vehicles, including petrol, diesel, LPG (liquefied petroleum gas), and fully electric vehicles. Employers use these rates to reimburse employees for the cost of fuel when they drive a company car for work. If employees use company cars for personal travel, they might need to repay the fuel cost based on these rates to avoid a benefit-in-kind tax charge.
The rates are reviewed and updated quarterly, reflecting changes in fuel prices and other related factors. This regular update ensures that reimbursements are in line with current fuel costs.
HMRC has published new Advisory Fuel Rates (AFRs), you can find the information on calculations and get email updates on the government website.
EV mileage rates have decreased:
1 pence per mile (ppm) cut to the Advisory Electricity Rate (AER), from 8-7ppm down again from 9-8ppm in May. This will naturally disappoint drivers as it doesn't reflect the rising costs of charging.
AFRs for diesel company cars have all decreased:
2,000+cc is cut from 20-18ppm.
1,601-2,000cc falls from 15-14ppm.
Up to 1,600cc 12ppm, down from 13ppm.
Petrol company cars have also been cut:
Up to 1,400cc lowered by 1ppm, from 14-13ppm
1,401-2,000cc bracket, from 16-15ppm.
2,000+cc, a cut of 2ppm, from 26-24ppm.
The rates for LPG vehicles, meanwhile, have remained unchanged:
11ppm for vehicles up to 1,400cc.
13ppm for 1,401-2,000cc.
21ppm for 2,000+cc.
Hybrid cars are treated as either petrol or diesel cars for AFR purposes.
Find out more information on how our vehicle tracking can help with fuel savings as well as other benefits.
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