HMRC Advisory fuel rates for company cars

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New company car advisory fuel rates have been published which took effect from 1 March 2014. HMRC’s website states:

These rates apply to all journeys on or after 1 March 2014 until further notice. For one month from the date of change, employers may use either the previous or new current rates, as they choose. Employers may therefore make or require supplementary payments if they so wish, but are under no obligation to do either.’

The advisory fuel rates for journeys undertaken on or after 1 March 2014 are:


Engine Size Petrol LPG
1400 cc or less 14p 9p
1401 cc to 2000 cc 16p 11p
Over 2000 cc 24p 17p
Engine Size Diesel   
1600 cc or less 12p
1601 cc to 2000 cc 14p
Over 2000 cc 17p

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

Other points to be aware of about the advisory fuel rates:

  • Employers do not need a dispensation to use these rates.
  • Employees driving employer provided cars are not entitled to use these rates to claim tax relief if employers reimburse them at lower rates. Such claims should be based on the actual costs incurred.
  • The advisory rates are not binding where an employer can demonstrate that the cost of business travel in employer provided cars is higher than the guideline mileage rates. The higher cost would need to be agreed with HMRC under a dispensation.

If in any doubt about fuel rates, or other tax rates and allowances contact your local Burgis & Bullock office on 0845 177 5500 or by using our online contact form.

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