Advisory fuel rates for company cars
New advisory fuel rates will be published shortly to take effect from 1 March 2011. HMRC have indicated the change will reflect the significant increases in UK average fuel pump prices since 1 December 2010.
HMRC usually announces new fuel rates just twice a year however the rates can change more often if fuel prices fluctuate by 5% or more from the published rates.
The rates below apply from 1 December 2010. For one month from the date of change, employers may use either the previous or new current rates, as they choose. Employers making or collecting payments at the superseded rate may use their judgement on whether to make or require a second payment in respect of the same period in order to apply the new rate from its effective date.
|1400cc or less||13p||12p||9p|
|1401cc to 2000cc||15p||12p||10p|
Employers should note that under the normal rules, employees are only able to avoid the car fuel benefit charge if the amount they repay in respect of private fuel at least equals the amounts based on the published rates.
Petrol hybrid cars are treated as petrol cars for this purpose. The figures can also be used for VAT purposes although businesses also need to retain fuel receipts.