Guidance

Advisory fuel rates

Find out about advisory fuel rates for company car users, when you can use them, and how they're calculated.

When you can use the mileage rates

These rates only apply to employees using a company car.

Use the rates when you either:

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

You must not use these rates in any other circumstances.

Reimburse employees for company car business travel

If the mileage rate you pay is no higher than the advisory fuel rates for the engine size and fuel type of the company car, there will be no taxable profit and no Class 1A National Insurance to pay.

If your cars are more fuel efficient, or if the cost of business travel is higher than the guideline rates, you can use your own rates to reflect your situation.

If you pay rates that are higher than the advisory rates but cannot show the fuel cost per mile is higher, there will be no fuel benefit charge if the mileage payments are only for business travel. Instead, you’ll have to treat any excess as taxable profit and as earnings for Class 1 National Insurance purposes.

Employees to repay the cost of fuel used for private travel

There will be no fuel benefit charge if you correctly record all private travel mileage and use the correct rate (or higher), to work out how much your employees must repay you for fuel used for private travel.

You will not need to use the advisory rates where you can show that employees cover the full cost of private fuel by repaying at a lower mileage rate.

How rates are calculated

HMRC review rates quarterly on:

  • 1 March
  • 1 June
  • 1 September
  • 1 December

The mean miles per gallon (MPG) is taken from manufacturers’ information, taking into account annual sales to businesses (fleet audits average 2016 to 2018). The MPG is adjusted down by 15% to take account of real driving conditions and lower fuel economy for older cars.

For liquefied petroleum gas (LPG), the MPG used is 20% lower than for petrol due to lower volumetric energy density.

The advisory electricity rate for fully electric cars is calculated using published consumption rates, adjusted to reflect real driving conditions and the average cost of electricity.

The advisory fuel rates worked out in these tables are shown to one decimal place, however the final rates are rounded to the nearest whole penny. When the precise decimal ends in a figure less than 0.5 it is rounded down to the nearest whole penny and when the precise figure ends in 0.5 or greater it is rounded up to the nearest whole penny.

The latest petrol and diesel prices are taken from the Department for Business, Energy and Industrial Strategy and the LPG (UK average) is from the Automobile Association website.

The advisory fuel rates are worked out from the fuel prices in these tables.

Petrol

Engine size (cc) Mean MPG Applied MPG Fuel price (per litre) Fuel price (per gallon) Rate per mile Advisory fuel rate
Up to 1400 57.0 48.5 105.1 pence 477.8 pence 9.9 pence 10 pence
1401 to 2000 47.6 40.5 105.1 pence 477.8 pence 11.8 pence 12 pence
Over 2000 32.7 27.8 105.1 pence 477.8 pence 17.2 pence 17 pence

Diesel

Engine size (cc) Mean MPG Applied MPG Fuel price (per litre) Fuel price (per gallon) Rate per mile Advisory fuel rate
Up to 1600 73.6 62.6 112.2 pence 510.2 pence 8.2 pence 8 pence
1601 to 2000 63.5 54.0 112.2 pence 510.2 pence 9.4 pence 9 pence
Over 2000 51.0 43.4 112.2 pence 510.2 pence 11.8 pence 12 pence

LPG

Engine size (cc) Mean MPG Applied MPG Fuel price (per litre) Fuel price (per gallon) Rate per mile Advisory fuel rate
Up to 1400 45.6 38.8 54.9 pence 249.6 pence 6.4 pence 6 pence
1401 to 2000 38.1 32.4 54.9 pence 249.6 pence 7.7 pence 8 pence
Over 2000 26.2 22.2 54.9 pence 249.6 pence 11.2 pence 11 pence

Rates

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

Hybrid cars are treated as either petrol or diesel cars when working out mileage rates.

The advisory fuel rates for petrol, LPG and diesel cars are shown in these tables.

From 1 June 2020

You can use the previous rates for up to 1 month from the date the new rates apply.

Engine size Petrol - amount per mile LPG - amount per mile
1400cc or less 10 pence 6 pence
1401cc to 2000cc 12 pence 8 pence
Over 2000cc 17 pence 11 pence
Engine size Diesel - amount per mile
1600cc or less 8 pence
1601cc to 2000cc 9 pence
Over 2000cc 12 pence

1 March 2020 to 31 May 2020

Engine size Petrol - amount per mile LPG - amount per mile
1400cc or less 12 pence 8 pence
1401cc to 2000cc 14 pence 10 pence
Over 2000cc 20 pence 14 pence
Engine size Diesel - amount per mile
1600cc or less 9 pence
1601cc to 2000cc 11 pence
Over 2000cc 13 pence

1 December 2019 to 29 February 2020

Engine size Petrol - rate per mile LPG - rate per mile
1400cc or less 12 pence 8 pence
1401cc to 2000cc 14 pence 9 pence
Over 2000cc 21 pence 14 pence
Engine size Diesel - rate per mile
1600cc or less 9 pence
1601cc to 2000cc 11 pence
Over 2000cc 14 pence

1 September 2019 to 30 November 2019

Engine size Petrol - rate per mile LPG - rate per mile
1400cc or less 12 pence 8 pence
1401cc to 2000cc 14 pence 10 pence
Over 2000cc 21 pence 14 pence
Engine size Diesel - rate per mile
1600cc or less 10 pence
1601cc to 2000cc 11 pence
Over 2000cc 14 pence

1 June 2019 to 31 August 2019

Engine size Petrol - rate per mile LPG - rate per mile
1400cc or less 12 pence 8 pence
1401cc to 2000cc 15 pence 9 pence
Over 2000cc 22 pence 14 pence
Engine size Diesel - rate per mile
1600cc or less 10 pence
1601cc to 2000cc 12 pence
Over 2000cc 14 pence

1 March 2019 to 31 May 2019

Engine size Petrol - rate per mile LPG - rate per mile
1400cc or less 11 pence 7 pence
1401cc to 2000cc 14 pence 8 pence
Over 2000cc 21 pence 13 pence
Engine size Diesel - rate per mile
1600cc or less 10 pence
1601cc to 2000cc 11 pence
Over 2000cc 13 pence

Find rates from an earlier date.

Published 21 July 2020