COMPANY CARS
Latest advisory car fuel rates published
HM Revenue and Customs (HMRC) recently published its advisory fuel rates designed to reflect the actual average cost of fuel for drivers using company cars on business or where companies require employees to repay the cost of fuel used for private travel. The new rates, effective from 1 February 2007 are:
| Engine size | Petrol | Diesel | LPG |
| 1,400cc or less | 9 | 9 | 6 |
| 1,401-2,000cc | 11 | 9 | 7 |
| Over 2,000cc | 16 | 12 | 10 |
Source: HM Revenue and Customs.
The figures help companies understand how the fuel rates they choose will be treated for tax and National Insurance purposes and are used in the majority of cases. Where a company can demonstrate that their fuel costs are higher or lower, however, the HMRC says that the above rates will not be binding. Because the rates are for guidance purposes it is hoped they will not change but in the event of a variation in fuel prices of greater than 10% from the initial price used they will be adjusted.
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Want to know more?
For full details of how the rates are calculated, previous rates, how they are used and dispensations, visit the HM Revenue and Customs web site at www.hmrc.gov.uk/cars/advisory_fuel_current.htm