HMRC reduce advisory fuel rate for petrol company cars

HMRC has announced their suggested reimbursement rates for employees' private mileage when using company cars from 1 December 2022, as summarised in the table below. The rates have been reduced in line with the recent fall in petrol prices. However, diesel prices remain the same and LPG reimbursement rates have increased.

Please note that provided all private fuel is fully reimbursed by the employee/director, the fuel benefit does not apply.

Where there has been a change, the rate for the previous quarter is shown in brackets. You can continue to use the previous rates for up to 1 month from the date the new rates apply.

Engine Size      Petrol           Diesel      LPG

1400cc or less      14p (15p)                      10p (9p)

1600cc or less     14p

1401cc to 2000cc  17p (18p)                      12p (11p)

1601 to 2000cc     17p

Over 2000cc       26p (27p)    22p      18p (17p)

For hybrid cars, you must use the petrol or diesel rate. For fully electric cars, the rate is now 8p per mile (previously 5p per mile).

If the employer’s policy is not to pay for any company car fuel, these amounts can be reimbursed tax-free to the employee for qualifying business journeys.