Advisory fuel rates
HMRC has updated the recommended reimbursement rates for employees reclaiming business travel in company vehicles.
If you pay for the fuel in your company car your employer can reimburse you for the cost of business journeys in that car at the following mileage rates tax free from 1 March 2024:
| Engine size: | Up to 1400 | 1400- 2000cc | Over 2000cc |
|---|---|---|---|
| Petrol | 13p | 15p | 24p |
| LPG | 11p | 13p | 21p |
| Engine size: | Up to 1600 | 1600- 2000cc | Over 2000cc |
| Diesel | 12p | 14p | 19p |
The advisory reimbursement rate for fully electric cars will be 9p per mile. Hybrid cars are treated as petrol or diesel cars for advisory fuel rates.
The above rates only apply to employees using a company car.
If you use your own car or van for work, the maximum amount you can be reimbursed tax-free is 45p per mile for the first 10,000 miles and 25p per mile thereafter. This amount was last updated in 2011.
An additional 5p per mile can be paid per passenger, provided that the journey is also business travel for the passenger. The rate for employees using motorcycles is 24p per mile. Where an employer uses their bicycle for work, the approved rate is 20p per mile. These amounts have not been updated since at least 2001.
If an employer chooses to make payments in excess of the mileage rates above to better reflect the costs of running a vehicle there will be tax complications for the employer and the employee.
