HMRC Advisory Fuel Rates for Company Car Users from 1 December 2024

Published: 02/12/2024 By Hannah Duncan

HMRC has reduced the advisory fuel rates for company car users of petrol and diesel vehicles, while the rates for electric cars remain unchanged.

Effective from 1 December 2024, the advisory fuel rates for petrol and diesel engines have been decreased by 1p per mile. The electric mileage rate continues to be the same.

The previous rates, which were effective from September 2024, can still be used for up to one month after the new rates take effect.

These rates are applicable only in the following situations:

• Reimbursing employees for business travel in their company cars.
• Requiring employees to repay the cost of fuel used for private travel.

These rates cannot be used in any other circumstances. If these rates are applied, there is no need to apply for a dispensation to cover the payments made.

From 1 December 2024, the advisory electricity rate for fully electric cars will be 7p per mile. This electric rate, like the advisory fuel rates, is now reviewed quarterly and is included in the tables (see photo).

When employees are reimbursed for business travel in their company cars, HMRC will accept that there is no taxable profit and no Class 1A National Insurance to pay.