HMRC Advisory Fuel Rates from 1 June 2016

HMRC has published the latest advisory fuel rates (AFR) for company car users, effective from 1 June 2016 reflecting the upward trend in forecourt fuel prices

These rates apply from 1 June 2016 and have been increased on the previous quarter rates. The previous rates 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.

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 2016

Petrol/LPG
Engine size Petrol – amount per mile LPG – amount per mile
1400cc or less 10 pence 7 pence
1401cc to 2000cc 13 pence 9 pence
Over 2000cc 20 pence 13 pence

 

Diesel
Engine size Diesel – amount per mile
1600cc or less 9 pence
1601cc to 2000cc 10 pence
Over 2000cc 12 pence

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

HMRC review rates quarterly on 1 March, 1 June, 1 September and 1 December.