Peninsula Group, HR and Health & Safety Experts
(Last updated )
Peninsula Group, HR and Health & Safety Experts
(Last updated )
HMRC has published the latest advisory fuel rates (AFR) for company car users, effective from 1 June 2023, cutting diesel rates
The advisory fuel rates that apply from 1 June 2023 have decreased by between 1p and 2p for all diesel engine sizes, while unleaded rates remain unchanged. There is a minimal increase in LPG engine rates compared with the March 2023 rates.
The previous rates, effective from March 2023, can be used for up to one month from the date the new rates apply.
The rates only apply in the following circumstances:
These rates cannot be used in any other circumstances. If the rates are used, it is not necessary to apply for a dispensation to cover the payments made.
From 1 June 2023 the advisory electricity rate for fully electric cars remains at 9 pence per mile. In line with advisory fuel rates, this electric rate is now being reviewed quarterly.
When employees are reimbursed for business travel in their company cars, HMRC will accept there is no taxable profit and no Class 1A national Insurance to pay.
Advisory fuel rates from 1 June 2023
Engine size
Petrol - amount per mile (previous)
LPG - amount per mile (previous)
1400cc or less
13p (13p)
10p (10p)
1401cc to 2000cc
15p (15p)
12p (11p)
Over 2000cc
23p (23p)
18p (17p)
Engine size
Diesel - amount per mile (previous)
Up to 1600cc
12p (13p)
1601cc to 2000cc
14p (15p)
Over 2000cc
18p (20p)
Hybrid cars are treated as either petrol or diesel cars for this purpose.
HMRC reviews rates quarterly on 1 March, 1 June, 1 September and 1 December.
If you have questions on issues surrounding employees who drive for work, visit BrAInbox today where you can find answers to questions like Do I have to pay employees for travel time?
Read more from the latest BrAInbox Business News update:
Rolled up holiday pay set to return: what exactly is it?
UK gender pay gap falls at fastest pace since 2017
Blog
The UK economy contracted by 0.5% in July, with falls in all three main sectors, according to data from the Office for National Statistics (ONS)
Blog
A director has lost a First Tier Tribunal (FTT) appeal against penalties charged by HMRC for VAT and corporation tax inaccuracies, which totalled £80,666.31.
Blog
Is AI a good thing? Or is its growing popularity something for us to worry about?
When AI meets 40 years of Peninsula expertise... you get instant, expert answers to your HR and health & safety questions
