HMRC advisory fuel rates are the pence-per-mile figures employers use to reimburse company car drivers for business fuel, or to work out how much an employee must repay for private mileage. From 1 June 2026, the rates run from 11p per mile for smaller LPG cars to 26p for petrol cars over 2,000cc, with fully electric company cars at 7p for home charging and 15p for public charging.1GOV.UK. Advisory Fuel Rates They apply only to company cars and are reviewed every quarter.
Current Rates From 1 June 2026
Petrol:1GOV.UK. Advisory Fuel Rates
- 1,400cc or less: 14p
- 1,401cc to 2,000cc: 17p
- Over 2,000cc: 26p
Diesel:1GOV.UK. Advisory Fuel Rates
- 1,600cc or less: 15p
- 1,601cc to 2,000cc: 17p
- Over 2,000cc: 23p
LPG:1GOV.UK. Advisory Fuel Rates
- 1,400cc or less: 11p
- 1,401cc to 2,000cc: 13p
- Over 2,000cc: 21p
Fully electric:1GOV.UK. Advisory Fuel Rates
- Home charger: 7p
- Public charger: 15p
The split between home and public charging replaced a single flat electric rate in December 2025.
Who the Rates Apply To
Advisory fuel rates apply only to employees driving a company car. HMRC states plainly: “You must not use these rates in any other circumstances.”1GOV.UK. Advisory Fuel Rates If you drive your own vehicle for work, the approved mileage allowance payments apply instead.2GOV.UK. Travel – Mileage and Fuel Rates and Allowances
Hybrids do not use the electric rate. HMRC treats a hybrid as either a petrol or a diesel car depending on its combustion engine, so a plug-in hybrid with a petrol engine falls into the petrol brackets above.1GOV.UK. Advisory Fuel Rates The advisory electric rate is for fully electric cars only.
Company vans are also outside the scope. Van fuel for private use is handled through a separate flat-rate benefit charge, with the taxable van fuel benefit for 2026-27 set at £798.3GOV.UK. Van Benefit Charge and Fuel Benefit Charges for Cars and Vans for Tax Year 2026 to 2027
When the Rates Change
HMRC publishes new rates quarterly, taking effect on 1 March, 1 June, 1 September, and 1 December. Each rate is built from average miles-per-gallon figures for the engine bracket and current fuel prices published by the Department for Energy Security and Net Zero (petrol and diesel) and the Automobile Association (LPG).1GOV.UK. Advisory Fuel Rates
After each change, employers have a one-month grace period during which they can continue applying the previous quarter’s figures. That buffer gives payroll time to update systems.
Paying Above or Below the Rate
The rates are advisory, not mandatory, but the tax treatment depends on which way you go.1GOV.UK. Advisory Fuel Rates
Reimburse at or below the published rate and there is no taxable profit and no Class 1A National Insurance for the employer. The payment sits outside the P11D as a straightforward cost reimbursement.1GOV.UK. Advisory Fuel Rates
Pay above the rate and the outcome depends on evidence. An employer who can show that the actual fuel cost per mile genuinely exceeds the advisory figure for that car has no additional tax to account for.1GOV.UK. Advisory Fuel Rates Without that evidence, the excess must be treated as taxable earnings, with Class 1 National Insurance due on it. Paying above the rate does not by itself trigger a fuel benefit charge; the excess is simply taxed as pay.
Using the Rates to Repay Private Fuel
When an employer provides fuel for a company car, for example through a fuel card, any private mileage the employee covers using that fuel creates a potential fuel benefit charge. For 2026-27, the charge is the £29,200 car fuel benefit multiplier applied to the vehicle’s CO₂ emissions percentage.3GOV.UK. Van Benefit Charge and Fuel Benefit Charges for Cars and Vans for Tax Year 2026 to 2027 That taxable figure applies regardless of how few private miles the employee actually drove.
The charge disappears entirely if the employee repays the full cost of all private fuel. The repayment is calculated by multiplying private miles by the advisory rate for the car’s fuel type and engine size. Partial repayments do not reduce the charge. It is all or nothing.1GOV.UK. Advisory Fuel Rates
The deadline for the repayment is 6 July following the end of the tax year. For private fuel used during 2025-26, the full repayment must reach the employer by 6 July 2026. Miss it, even by a day, and the full benefit charge applies for the whole year.
Records You Need to Keep
Accurate mileage logs are the foundation of any advisory fuel rate claim. HMRC expects each entry to show the reason for the journey and the start and end postcodes, with business and private travel clearly separated.4GOV.UK. Claim Tax Relief for Your Job Expenses
The car’s engine size and fuel type decide which rate applies, and the V5C registration document is the standard reference for confirming those details. Slotting a car into the wrong engine bracket creates a discrepancy HMRC can pick up during a compliance check. Employers claiming VAT on fuel costs should also retain fuel receipts, even though the reimbursement itself is a flat pence-per-mile figure.
How Long to Keep Records
Companies must keep records for six years from the end of the relevant accounting period. Self-employed individuals and partners must retain records for at least five years from 31 January following the tax year the return covers.5HM Revenue & Customs. A General Guide to Keeping Records for Your Tax Return Those minimums extend if HMRC opens a compliance check. Records can be kept digitally, provided the digital copy captures everything and can be produced in a readable format on request.
Advisory Fuel Rates vs Mileage Allowance Payments
These are two different systems and mixing them up is one of the most common mistakes. Advisory fuel rates cover fuel only and apply only to company cars. Mileage allowance payments (AMAPs) apply when an employee drives their own vehicle for work, and are designed to cover fuel, wear and tear, insurance, and depreciation in a single per-mile figure.2GOV.UK. Travel – Mileage and Fuel Rates and Allowances
The approved AMAP rates have been unchanged since 2011-12: 45p per mile for the first 10,000 business miles in a tax year and 25p for each mile after that, for cars and vans. Motorcycles are at 24p per mile and bicycles at 20p.2GOV.UK. Travel – Mileage and Fuel Rates and Allowances Because AMAPs bundle in running costs beyond fuel, they sit well above the advisory fuel rates. Using AMAP rates for a company car, or advisory fuel rates for a personal one, creates tax problems that HMRC is well-practised at spotting.