HMRC have recently released the latest Advisory fuel rates that came into effect from 1 September 2019.
These rates apply to employees using Company cars on business journeys.
There are a number of changes covering petrol, LPG and diesel engine vehicles.
The 1400cc or less rate has remained unchanged at 12p per mile
The 1401cc to 2000cc rate has decreased by 1p from 15p to 14p per mile
The over 2000cc rate has decreased by 1p from 22p to 21p per mile
The 1400cc or less rate has remained unchanged at 8p per mile
The 1401cc to 2000cc rate has increased by 1p from 9p to 10p per mile
The over 2000cc rate has remained unchanged at 14p per mile
The 1600cc or less rate has remains unchanged at 10p per mile
The 1601cc to 2000cc rate has decreased by 1p from 12p to 11p per mile
The over 2000cc rate remains unchanged at 14p per mile.
HMRC have also confirmed that the Advisory Electricity Rate for fully electric cars remains at 4 pence per mile. Electricity is not a fuel for car fuel benefit purposes.
The link to the new rates for September 2019 is below for your information. Please note that, although the link refers to March 2016 it links through to the September 2019 rates.
it is important to ensure that employees are paid within the HMRC rates to avoid a tax charge arising. During an employer compliance inspection one of the key checks made by HMRC relates to claims made relating to business travelled, both in company cars and employees own vehicles, and HMRC make a significant amount of recoveries from employers in respect of excess rate payments.
If you would like any help in understanding how Smith Cooper can help you to minimise your risks of underpaid tax and NIC arising during HMRC Compliance Inspections, please contact our Employment Tax team.