The HMRC Advisory Fuels Rates are the amounts set out by HMRC that you need when:
- reimbursing employees for business travel in their company cars;
- setting rates that employees repay businesses for private fuel use on fuel cards;
- calculating input VAT to be claimed on Mileage Allowance Payments.
You’ll need to use these HMRC Advisory Fuel Rates regardless of the true of of the fuel if you are doing any of the above three things.
How Much Are the HMRC Advisory Fuel Rates for 2017
The HMRC Advisory Fuel Rates can change each year but the effective rates from 1 December 2017 are:
|Engine size||Petrol – amount per mile||LPG – amount per mile|
|1400cc or less||11 pence||7 pence|
|1401cc to 2000cc||14 pence||9 pence|
|Over 2000cc||21 pence||14 pence|
|Engine size||Diesel – amount per mile|
|1600cc or less||9 pence|
|1601cc to 2000cc||11 pence|
|Over 2000cc||13 pence|
Hybrid cars are treated as either petrol or diesel cars for this purpose.
HMRC Advisory Fuel Rates vs Mileage Allowance Payments
Mileage allowance payments are higher because they reflect wear and tear, insurance and car maintenance, so are used when people use their personal vehicles for business purposes. Advisory fuel rates relate to just fuel so are used where individuals have been provided with Company Cars and the business covers the cost of car maintenance and insurance.