HMRC advisory fuel rates for company car users from 1 June
HMRC has published the latest advisory fuel rates (AFR) for company car users, effective from 1 June 2022, increasing rates between one and three pence per mile in light of soaring fuel prices at forecourts
The advisory fuel rates that apply from 1 June 2022 have been increased across the board from the March 2022 rates with a three pence increase on petrol vehicles over 2000cc for example, while the equivalent diesel vehicle rate goes up from 16p to 19p, while LPG rates go up by 1p across all vehicles.
The previous rates, effective March 2022, can be used for up to one month from the date the new rates apply.
The rates only apply in the following circumstances:
- reimburse employees for business travel in their company cars; or
- require employees to repay the cost of fuel used for private travel.
These rates cannot be used in any other circumstances. If the rates are used, it is not necessary to apply for a dispensation to cover the payments made.
The advisory electricity rate for fully electric cars has also increased to 5p per mile, up from 4p. Electricity is not a fuel for car fuel benefit purposes.
When employees are reimbursed for business travel in their company cars, HMRC will accept there is no taxable profit and no Class 1A national Insurance to pay.
Advisory fuel rates from 1 June 2022
| Engine Size | Petrol – amount per mile (previous) | LPG – amount per mile (previous) |
|---|---|---|
| 1400cc or less | 14p (13p) | 9p (8p) |
| 1401cc to 2000cc | 17p (15p) | 11p (10p) |
| Over 2000cc | 25p (22p) | 16p (15p) |
| Engine Size | Diesel – amount per mile (previous) |
|---|---|
| 1600cc or less | 13p (11p) |
| 1601cc to 2000cc | 16p (13p) |
| Over 2000cc | 19p (16p) |
Hybrid cars are treated as either petrol or diesel cars for this purpose.
HMRC reviews rates quarterly on 1 March, 1 June, 1 September and 1 December