Company Car Mileage Rates slashed

Company Car Mileage Rates slashed following dramatic reduction in fuel prices

From: Ben Davies

Car Costs shutterstock_244600525

HM Revenue & Customs has recently announced that the advisory fuel rates (AFR), used to reimburse drivers of company cars for business travel, are to be slashed by up to 18%.  The new AFR will apply from 1 March 2015 to bring them in line with the reduction to fuel prices seen at the pumps.

The new rates are:

Engine size Petrol LPG
1400cc or less 11p 8p
1401cc to 2000cc 13p 10p
Over 2000cc 20p 14p


Engine size Diesel
1600cc or less 9p
1601cc to 2000cc 11p
Over 2000cc 14p


You can however use the old rates for up to 1 month from the 1 March.

If you drive a hybrid vehicle then you should use the petrol rates for a petrol hybrid vehicle and the diesel rates for a diesel hybrid vehicle.

The advisory fuel rates are reviewed every quarter by HM Revenue & Customs and are calculated based on the average fuel prices at the time.  The latest rates can be found on the HMRC website here.

Where you are not using a company car but your own private car you should instead use the Approved Mileage Allowance payments, known as AMAPs.