Employers who operate company car schemes should be aware that new advisory rates have been released applicable to journeys made on or after 1 June 2015.
Advisory fuel rates apply in relation to company vehicles where the employer either reimburses employees for any business travel in company cars, or where employees are required to repay any fuel costs associated with private use of the car.
Employers can choose to set rates which are different to the advisory rates. However, if the rate paid for business use is no higher than the advisory rate (linked to engine size and type of fuel), HMRC will not regard this as taxable or liable to Class 1 national insurance contributions.
The new rates are as follows:-
|Engine size||Petrol – amount per mile||LPG – amount per mile|
|1400cc or less||12p||8p|
|Diesel – amount per mile|
|1600cc or less||10p|
|1601cc to 2000cc||12p|
The old rates can still be used by employers during the month of June.