HM Revenue & Customs have released their new advisory fuel rates which will take effect from 1st July 2008.

 

Engine size

Petrol

Diesel

LPG

1400cc or less

12p

13p

7p

1401cc to 2000cc

15p

13p

9p

Over 2000cc

21p

17p

13p

Petrol hybrid cars are treated as petrol cars for this purpose.

 

These rates are calculated from the fuel prices in the tables below:

Petrol

Engine size

(cc)

Mean
MPG

Applied
MPG

Fuel price
(per litre)

Fuel price
(per gallon)

Pence per mile

AFR

up to 1400

48.9

44.0

114.8

521.8

11.9

12

1400 - 2000

39.5

35.6

114.8

521.8

14.7

15

over 2000

27.8

25.0

114.8

521.8

20.9

21

Diesel

Engine size
(cc)

Mean
MPG

Applied MPG

Fuel price
(per litre)

Fuel price
(per gallon)

Pence
per mile

AFR

up to 2000

50.7

45.7

127.2

578.3

12.7

13

Over 2000

38.2

34.4

127.2

578.3

16.8

17

LPG

Engine size (cc)

Mean
MPG

Applied
MPG

Fuel price
(per litre)

Fuel price
(per gallon)

Pence
per mile

AFR

up to 1400

39.1

35.2

57.1

259.6

7.4

7

1400 - 2000

31.6

28.5

57.1

259.6

9.1

9

over 2000

22.2

20.0

57.1

259.6

13.0

13

Notes: Mean mpg - miles per gallon - from manufacturers information, weighted by annual sales to businesses (Fleet Audits, 2006). Applied mpg - adjusted downwards by 10 per cent to take account of real driving conditions and lower fuel economy for older cars. For LPG, mpg is assumed to be 20 per cent lower than for petrol due to lower volumetric energy density. Department for Business, Enterprise & Regulatory Reform's latest petrol and diesel prices (26 May 2008), LPG from AA website (May 2008).

 

Will the rate per mile figures change if fuel prices go up or down?

With effect from the January 2008 change, the rates will be reviewed twice a year. Any changes will take effect on 1 January and 1 July but will be published on the HMRC website about one month in advance (http://www.hmrc.gov.uk/cars/advisory_fuel_current.htm).

HMRC will also consider changing the rates if fuel prices fluctuate by 5 per cent from the published rates when each review is made and HMRC consider the price change will be sustained.

Employers should make themselves aware of any changes by referring to http://www.hmrc.gov.uk/cars/advisory_fuel_current.htm in June and December each year. It is the primary source of information.

 

VAT

Customs will also accept the figures in the table for VAT purposes though employers will need to retain receipts in line with current legislation.