HMRC changes to advisory fuel rates – December 2020

Every 3 months, HMRC review the advisory fuel rates. They apply to employees using a company car if:

• You reimburse employees for business travel
• Or require employees to repay the cost of private travel

These are “fuel only” rates, and if you use them, you have certainty that you are claiming no more than the true cost of fuel used on business journeys and so will not be taxed on a ‘fuel benefit’.

Hybrid cars are treated as either petrol or diesel cars for advisory fuel rates.

These rates apply from 1^st December 2020.

Engine size	Petrol – amount per mile	LPG – amount per mile
1400cc or less	10p	7p
1401cc to 2000cc	11p	8p
Over 2000cc	17p	12p

Engine size	Diesel – amount per mile
1600cc or less	8p
1601cc to 2000cc	10p
Over 2000cc	12p

The advisory electricity rate for fully electric cars is 4p per mile.

Civica provide an HMRC Rate Update Service, to help organisations implement changes like these. Find out how MyExpenses can transform the management of your expenses. Or speak to your account manager to find out how to add the HMRC rate update service onto your MyExpenses account.