It is critical to regularly monitor advised fuel rates. This is why.
What are the recommended gasoline prices?
If you drive a work vehicle (or van), you should be aware of the most recent advice fuel rates (AFRs). They establish a per-mile rate for recuperating gasoline expenditures if you’re out on business and are refreshed every three months to reflect changing gas prices. Employers may also utilise them to claim back gasoline for personal mileage, such as if drivers use a fuel card.
The Autocar business car tax calculator tells you precisely how much you’ll pay for each make and model.
Of course, the cost of gasoline varies on the vehicle, so the system is rather granular. There are distinct AFRs for petrol, diesel, and LPG cars, with variable rates depending on engine size. Rates are computed using an average fuel efficiency number for fleet cars and the most recent forecourt prices in the UK, rounded to the nearest whole penny.
What are the ranges of electric and hybrid vehicles?
Because HMRC does not consider electricity to be a fuel, it took until 2018 to implement a mileage rate particularly for electric cars. The Advisory Electric Rate (AER) is computed in the same way as the AFR, using data on energy efficiency and the average cost of a unit of electricity at home. All EVs are now charged a fixed cost of 5p per mile.
Hybrids still lack their own AFRs. Based on engine size, all hybrids, including plug-ins, are reimbursed at the same rates as a petrol or diesel automobile.
Can businesses determine their own rates? Yes, but the situation is tricky. According to HMRC, firms may change the rates if they are leaving drivers out of cash or if the real travel expenses are significantly lower, which might be beneficial for plug-in hybrids. They must, however, present documentation as to why the modification was necessary, and any excess may be taxed.