HMRC raises new Advisory Fuel Rates by up to 3p per mile

General Guides  HMRC / Tax 

New AFRs effective from 01 June 2022

The government has released new Advisory Fuel Rates (AFRs) that come into effect from 01 June 2022 for company car drivers claiming back fuel costs from their employer.

HM Revenue and Customs (HMRC) reviews the rates quarterly, although it was criticised for the last set of AFRs in March as, despite rising fuel costs that reached new record highs in spring, made no move to alter the rates to meet altered conditions at the pumps.

The new set of AFRs sees rates increased by as much as 3p per mile to reflect higher costs at the pumps. Rates for petrol cars have increased 1p, 2p, or 3p per mile depending on the size of the engine, while diesel cars have seen a similar increase, of either 2p or 3p per mile - see table below.

Diesel (inc. hybrid): engine size (cc)	Advisory Fuel Rate (AFR)
Up to 1,600cc	13 pence
1,601cc - 2,000cc	16 pence
Over 2,000cc	19 pence

Petrol (inc. hybrid): engine size (cc)	Advisory Fuel Rate (AFR)
Up to 1,400cc	14 pence
1,401cc - 2,000cc	17 pence
Over 2,000cc	25 pence

Electric: fully-electric	Advisory Fuel Rate (AFR)
All models	5 pence

The Advisory Electricity Rate (AER) for pure-electric cars has remained at 5p per mile. Hybrid models are classified as either petrol or diesel, depending on engine fuel type, for the purposes of AFRs.

AFRs are published at a pence-per-mile (PPM) rate, and provide a suggested figure for reimbursing company car drivers for business mileage. They can also be used by drivers to reimburse employers for private mileage where all fuel is paid, avoiding paying free fuel tax.

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