New fuel rates published by HMRC

Old petrol pumps in Nøtterøy, Norway

Image via Wikipedia

Changes have been announced to the company car advisory fuel rates with effect from 1 July 2009.

Unless you do a huge amount of private milage, you probably shouldn’t be provided with fuel for ‘private use’ because the tax charge on this is now very high. The rates below you can use to calculate the petrol cost of your private motoring, if you pay this back to your employer to avoid the fuel based benefit in kind charge.

Employers can also use the figure to isolate the petrol cost of car mileage claims in order to recover an appropriate amount of VAT – businesses still need to retain fuel receipts.

Some of the rates have been reduced in light of slightly lower fuel prices at the pumps.

Engine size: Petrol, Diesel, LPG

1400cc or less: 10p, 10p, 7p

1401cc to 2000cc: 12p, 10p, 8p

Over 2000cc: 18p, 13p, 12p

Petrol hybrid cars are treated as petrol cars for this purpose.

The fuel rates are usually reviewed twice a year effective 1 January and 1 July although may change more often where there is significant fluctuation in fuel prices. The rates are ‘advisory’ so if you have justification, you may use a different rate.

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