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AER increases again in new HMRC rates

 Published 5th September 2023
HMRC / Tax 

The advisory electricity rate (AER) has increased for company car drivers in electric cars (EVs), rising to 10 pence per mile (ppm).

HM Revenue and Customs analyses Advisory Fuel Rates (AFR) each quarter, which includes an AER, which can be used to reimburse drivers of company cars and to calculate costs.

A two pence rise in the last half year reflects continued high electricity prices, with the aim being that drivers are not left out of pocket by charging their car for work purposes.

It's not just electric vehicles that have seen an increase, with petrol and diesel models also seeing rises. The diesel AFR for company cars with an engine over 2,000cc increased by a penny to 19ppm, though other rates have remained the same for diesel models.

Two petrol classes have increased, with those powered by engines of 1,401-2,000cc increased by 1ppm to 16ppm, and petrol models with an engine of more than 2,000cc get a 2p increase to 25ppm. Hybrid models are calculated on the core fuel type - petrol or diesel - for AFR purposes.

The new AFRs from 1st September 2023 are:

Diesel (inc. hybrid): engine size (cc) Advisory Fuel Rate (AFR)
Up to 1,600cc 12 pence
1,601cc - 2,000cc 14 pence
Over 2,000cc 19 pence


Petrol (inc. hybrid): engine size (cc) Advisory Fuel Rate (AFR)
Up to 1,400cc 13 pence
1,401cc - 2,000cc 16 pence
Over 2,000cc 25 pence


LPG: engine size (cc) Advisory Fuel Rate (AFR)
Up to 1,400cc 10 pence
1,401cc - 2,000cc 12 pence
Over 2,000cc 19 pence


Electric: fully-electric Advisory Fuel Rate (AFR)
All models 10 pence

Source: HMRC Advisory Fuel Rates

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