Fleet News

HMRC makes change to advisory fuel rate after original update

HM Revenue and Customs (HMRC) has made a further change to advisory fuel rates (AFRs) after initially publishing new rates for the next quarter last week.

The new rates, which come into force from March 1, initially showed that the rate for petrol engined vehicles above 2000cc had fallen by 1p per mile, from 21ppm to 20ppm, and the rate for LPG vehicles above 2000cc had increased by a penny a mile, from 13ppm to 14ppm.

However, HMRC has since amended its figures online to show the petrol rate has increased by 1ppm, not fallen as originally stated. The new rate from March 1 will therefore be 22ppm.

The 1ppm increase, from 13ppm to 14ppm, for LPG vehicles above 2000cc remains effective from March 1.     

All other rates are unchanged.

Fleet News is waiting to hear from HMRC why the original petrol rate it published last week was subsequently changed. 

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  • Petrol Paul - 28/02/2017 11:54

    It has the touch of the Oscars about it! Seriously with petrol prices rising (from about 109ppl last quarter to 118ppl this quarter) it looked like a mistake straight away. We stilll come across a great number of organisations whose unattractive scheme design (coupled with agressive Government BIK charges) means drivers are now opting out of company cars only to drive private vehicles with bigger engines / higher C02 and in the process more then double fuel reclaim rates (eg Audi 1.6tdi Company car 9ppm to Private choice 2L+ Petrol at 22ppm). Employeers need to work harder than ever to make car schemes flexible and attractive so they can control both duty of care and cost.

  • Mark Austin - 01/03/2017 15:17

    I currently have a Nissan Qashqai 1.5d as a company car, the lease is up on the 31st May this year and i cannot wait to get rid of it. I frequently drive an 850 mile round trip from Cumbria to Kent and with the current AFR of .09 per mile i am £7.80 out of pocket per trip... if i sit at 70 on the motorway the Qashqai returns 55mpg nowhere near the advertised figure of 74mpg. Also thanks to the chancellor my company car tax has incresed beyond the original advised rates over the three year period, almost £30 a month more in year 3 than the orignal contract i took out. why arnt terms fixed for you contract... i will be in my own car shortly, bigger engine, more polution, same MPG and 42PPM...company cars are just not worth it anymore and you get hammered if you use it for private mileage...

    • Petrol Paul - 06/03/2017 11:26

      You can stil make the company car work Mark - so long as your company has a reasonably flexible scheme. The Toyota CHR would give you excellent fuel economy (from a 1.8 Petrol Hybrid Engine) at about the same lease rate for your company. As its a 1.8 petrol engine you's be able to claim (assuming your company is allowing AFR's) you'd get 14ppm not 9ppm (and lower car tax - no 3% BIK surcharge for Diesel). If your company has 'not seen the light yet' and runs a diesel only policy then the Infiniti Q30 has a 2.2d option which again would net (13ppm instead of 9ppm) a return that would comfortably cover your fuel cost and perhaps even offset the small extra contribution you might need to make (the lease rate on the Q30 a bit more than the Qashqia. Nissan and Sunderland would be happy - they are both built there. I work for a lease company - cleary we want our clients drivers to remain in company cars (and to do it cost effectively) but for the reasons you give its also in your employers Corporate Social Resposability to help provide you with a car to do your role thats clean and effecient - with-out you being out of pocket and resorting to a option that exposes all sorts of 'grey fleet' issues.

    • Petrol Paul - 07/03/2017 11:21

      HI Mark, The funky looking - Toyota CHR (or it's British Built but bland Stablemate - Toyota Auris) both would net you 14ppm in Hybrid 1.8 Petrol - so you would not be out of pocket, and as no 3% BIK surchase (as its not diesel) you would make a tax saving too. Lease rates are similar so providing your employer allows a flexable choice that would be my recommendation. The new Golf is also available with a very effecient 1.5 turbo petrol engine (again 14ppm) as its over 1400cc and for long motorway drives in top gear and low revs would drop cylinders to give decent economy. I work for a lease company so have an interest in keeping drivers in company cars but agree that the recent Government / HMRC direction is making carefull decision making by drivers and a flexable scheme by employeers essential to ensure that company cars still offer good value.

  • Bob the Engineer - 01/03/2017 19:50

    Pah! lol, I wanted to make an Oscars joke but there were no comments box available when this story was first posted. Kudo to Petrol Paul for taking the glory.

  • Skint Driver - 03/03/2017 10:40

    Ah well - need to keep paying to do my job! 1.6Tdi Passat. Costs 10p a mile to run - get 9p - and remember that this rate is also meant to cover incidentals like oil top ups. Problem with fitting smaller engines to bigger cars is that the "average" economy per engine size is skewed by the larger number of small vehicles with smaller engines, and of course the unrealistic government fuel economy figures

  • Chris Byrne - 08/03/2017 08:35

    This makes me laugh? I have a 1800cc petrol engined car. I have receipts for petrol dated 6th December 2016 and fuel was £109.9 p/l.A receipt I have for petrol, from the same filling station on 18th February was for £115.9 p/l. This is an increase of £0.06 for every litre of fuel I use but there is no increase in the rates for petrol engined cars below 2000cc?

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