|
To reflect the reduction in fuel prices,
HMRC have issued new advisory fuel rates
for employees driving employer provided
cars. These take effect for all journeys
undertaken from 1 January 2009, so
employers using the advisory rates should
advise affected employees and update any
expense forms as soon as possible. The
advisory fuel rates should be used for
journeys undertaken on or after 1 January
2009.
|
Engine size |
Petrol |
Diesel |
LPG |
|
1400cc or less |
10p (12p) |
11p (13p) |
7p (7p) |
|
1401cc – 2000cc |
12p (15p) |
11p (13p) |
9p (9p) |
|
Over 2000cc |
17p (21p) |
14p (17p) |
12p (13p) |
HMRC are supposed to give employers a
month’s notice of changes to these rates.
However, according to the HMRC guidance:
‘As was done for the July 2008 changes,
HMRC is content for the new rates to be
implemented immediately where employers
are able and wish to do so.’
Other points to be aware of about the
advisory fuel rates:
- employers do not need a dispensation
to use these rates.
- employees driving employer provided
cars are not entitled to use these rates
to claim tax relief if employers
reimburse them at lower rates. Such
claims should be based on the actual
costs incurred.
- the advisory rates are not binding
where an employer can demonstrate that
the cost of business travel in employer
provided cars is higher than the
guideline mileage rates. The higher cost
would need to be agreed with HMRC under
a dispensation.
If you would like to discuss your car
policy, please contact us.
Internet link:
HMRC advisory fuel rates |
