New Advisory Fuel Rates published by HMRC

HMRC / Tax 

Electric rate remains fixed as new AFRs effective from 1st June 2023.

The government has released new Advisory Fuel Rates (AFRs) which come into play from Thursday 1st June. The rates are used by businesses and drivers when claiming back fuel costs from their employer or for private mileage when all fuel is paid for by the business to avoid fuel tax.

HM Revenue and Customs’ (HMRC) new figures have seen the Advisory Electricity Rate (AER) - which is used to calculate costs for electric vehicles - remain static, though there have been changes to the diesel figures from the last quarter, reflecting a drop in fuel prices.

The diesel rates are cut by either 2ppm (pence-per-mile) or 1ppm, depending on engine size. Hybrid vehicles are categorised as petrol or diesel models, based on their core fuel type.

AFRs are published at a pence-per-mile 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.

Rates are calculated by HMRC using figures supplied by the Business, Energy, & Industrial Strategy (BEIS), as well as information on energy consumption supplied by the Department for Transport (DfT). AFRs are reviewed quarterly in an effort to reflect fuel and energy costs.

The new AFRs from 1st June are:

Diesel (inc. hybrid): engine size (cc)	Advisory Fuel Rate (AFR)
Up to 1,600cc	12 pence (minus 1p)
1,601cc - 2,000cc	14 pence (minus 1p)
Over 2,000cc	18 pence (minus 2p)

 

Petrol (inc. hybrid): engine size (cc)	Advisory Fuel Rate (AFR)
Up to 1,400cc	13 pence (no change)
1,401cc - 2,000cc	15 pence (no change)
Over 2,000cc	23 pence (no change)

 

Electric: fully-electric	Advisory Fuel Rate (AFR)
All models	9 pence (no change)

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