HMRC’s new advisory fuel rates take effect on September 1, adjusting mileage reimbursements for company cars that are driven for work purposes.
Petrol and diesel allowances see modest shifts
For petrol engines up to 1,400 cc, the reimbursement stays at 14 pence per mile, matching the previous level. Engines between 1,401 cc and 2,000 cc also remain unchanged at 17 pence.
The only increase for gasoline power comes with engines larger than 2,000 cc, where the rate rises from 26 pence to 27 pence per mile.
Diesel figures move in the opposite direction. Vehicles with engines from 1,601 cc to 2,000 cc drop from 17 pence to 16 pence, while those over 2,000 cc fall from 23 pence to 22 pence. Cars up to 1,600 cc keep the 15 pence rate.
LPG and electric charging rates retain most levels
Liquefied petroleum gas models see little change: up to 1,400 cc stays at 11 pence, and the 1,401 cc‑2,000 cc band stays at 13 pence per mile. Larger LPG units fall from 21 pence to 20 pence.
Electric‑vehicle allowances are split between home and public charging. Home charging continues at 7 pence per mile, calculated from an electricity cost of 24.47 pence per kilowatt‑hour and an average efficiency of 3.59 kWh per mile.
Public‑network charging also remains at 15 pence per mile, using a cost assumption of 54 pence per kilowatt‑hour.
Related: UK car output drops nearly 12 percent
That electricity price reflects the Zapmap public‑charging price index, adjusted with the latest Office for National Statistics electricity estimate.
HMRC notes that companies may claim a higher amount than the advisory figure if they can demonstrate a higher fuel cost per mile, especially for ultra‑fast chargers.
Hybrid models are classified as gasoline or diesel.
Full tables of the new figures are posted on the fleet‑FAQ page.
In practice, the adjustments mean fleet managers will need to revisit their expense systems to ensure the correct per‑mile amounts are applied. The slight rise for large gasoline engines may offset the cuts for comparable diesel units, but overall reimbursement totals could shift modestly depending on the mix of vehicles in use.
Context of fuel price trends
Average UK gasoline prices hit 161.6 pence per litre last week, the highest level since 2022, according to the report. Diesel averaged 183.4 pence per litre.
HMRC based the new allowances on benchmark prices of 159.9 pence for gasoline and 179.2 pence for diesel, slightly below the recent market rates.
