HMRC New Advisory Fuel Rates

HMRC have given notice of the new advisory mileage rates for employer provided cars from 1 June 2015.
Although these rates come into effect from 1st of June, employers can still use the old rates for June to allow for procedures to be changed and for employees to be notified.

Unfortunately HMRC announced an incorrect mileage rate figure when they originally published the revised Advisory Mileage Rates applicable from 1 June 2015.

The error was in respect of petrol engined cars 1401cc to 2000cc. The rate should be 14p per mile and not 12p per mile.

The rates have been corrected on the HMRC website

The revised article is published below with the corrected rate highlighted in yellow.

The rates, including previous rates, are:

PETROL

Fuel	Period	Engine Size
		1400cc or less	1401 to 2000cc	Over 2000cc
Petrol and  petrol-hybrid (pence per mile)	from 1/12/13	14p	16p	24p
	from 1/03/14	14p	16p	24p
	from 1/06/14	14p	16p	24p
	from 1/09/14	14p	16p	24p
	from 1/12/14	13p	16p	23p
	from 1/03/15	11p	13p	20p
	from 1/6/15	12p	14p	21p

LPG

	Period	Engine Size
		1400cc or less	1401cc to 2000cc	Over 2000cc
LPG (pence per mile)	from 1/12/13	9p	11p	16p
	from 1/03/14	9p	11p	17p
	from 1/06/14	9p	11p	16p
	from 1/09/14	9p	11p	16p
	from 1/12/14	9p	11p	16p
	from 1/03/15	8p	10p	14p
	from 1/6/15	8p	9p	14p

DIESEL

	Period	Engine Size
		1600cc or less	1601 to 2000cc	Over 2000cc
Diesel (pence per mile)	from 1/12/13	12p	14p	17p
	from 1/03/14	12p	14p	17p
	from 1/06/14	12p	14p	17p
	from 1/09/14	11p	13p	17p
	from 1/12/14	11p	13p	16p
	from 1/03/15	9p	11p	14p
	from 1/6/15	10p	12p	14p

HMRC documents the way in which the rates are calculated.  They are based on average fuel consumption for the different engine sizes, reduced by 15% to make the figures more realistic.  The fuel prices used are:

• petrol – 115.70 per litre (526.20p per gallon)
• diesel – 121.00p per litre (550.20p per gallon)
• LPG – 61.70p per litre (280.50p per gallon)

By way of a reminder, the Advisory Fuel Rates are provided by HMRC for employers to apply where they:

• reimburse employees for business travel in their company cars, or
• require employees to repay the cost of fuel used for private travel in company cars

Comment
Interestingly, there is actually an error on the relevant HMRC page where it states “These rates apply from 1 March 2015”. This, of course, should read 1 June 2015.
For further information

• HMRC Website – Current Advisory Fuel Rates
• HMRC Website – Earlier Rates