Advisory fuel rates (company car drivers)

HMRC have published new advisory fuel rates for company car drivers which will apply from 1 December 2024. 

This is a freeview 'At a glance' guide to advisory fuel rates for company car drivers. 

At a glance

The rates from 1 December 2024

*Fully electric cars only

Old rates may be used for up to 1 month from the date any new rates apply. Thus the previous rates (see below) can be used until 31 December 2024.  

Advisory fuel rates are set by HMRC

• Employers can use these rates to reimburse Company car drivers for business fuel.
• These rates can also be used if employees are required to repay the cost of fuel used for private travel.
• These rates should not be used in relation to Vans.
• The electric rate is reviewed quarterly from 1 March 2023. 
• Hybrid cars can be treated as either petrol or diesel cars for this purpose.
• These amounts also apply for VAT purposes, but employers can only reclaim input VAT if the employee supplies a receipt.

On 1 December 2017, as part of the Taxation of employee expenses: Response to the call for evidence, the government announced it had considered the position and had no plans to change the current system; in particular it would not introduce specific rates for hybrid and electric cars. However, in August 2018 HMRC announced that from 1 September 2018:

• They would accept that if employers pay up to the advisory rate, which was at that time four pence per mile, when reimbursing employees for business travel in a fully electric company car there is no profit for Income Tax or earnings for National Insurance (NI) purposes.
• Employers can use their own rate if it better reflects circumstances, for example, if their cars are more efficient, or if the cost of business travel is higher than the guideline rate. 
• If employers pay a rate that is higher than the advisory rate and cannot demonstrate the electricity cost per mile is higher, they must treat any excess as taxable income and as earnings for Class 1 National Insurance purposes.

Rates from 1 September 2024 

*Fully electric cars only

Rates from 1 June 2024 

*Fully electric cars only

Rates from 1 March 2024 

*Fully electric cars only

Rates from 1 December 2023

 *Fully electric cars only

Rates from 1 September 2023

 *Fully electric cars only

Rates from 1 June 2023 

 *Fully electric cars only 

Rates from 1 March 2023

*Fully electric cars only   

Rates from 1 December 2022

*Fully electric cars only

Rates from 1 September 2022

*Fully electric cars only

Rates from 1 June 2022

*Fully electric cars only

Rates from 1 March 2022

*Fully electric cars only

Rates from 1 December 2021

*Fully electric cars only

Rates from 1 September 2021

*Fully electric cars only

Earlier rates