The mileage rates for petrol, diesel, hybrid and electric cars

It’s vital to closely watch advisory fuel rates. Here’s why.

What are advisory fuel rates?

If you’re driving a company car (or van), the latest advisory fuel rates (AFRs) are what you need to keep an eye on. Refreshed every three months to reflect shifting prices at the pump, they set a per-mile rate for reclaiming fuel expenses if you’re out on business. Employers can also use them to claim back fuel for private mileage – for example, if drivers are using a fuel card.

Of course, that fuel cost depends on what you’re driving, so the system is fairly granular. There are specific AFRs for petrol, diesel and LPG vehicles, each of which also has different rates depending on the size of the engine. Rates are calculated based on an average fuel efficiency figure for vehicles sold to fleets and the latest forecourt prices across the UK, rounded to the nearest whole penny.

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From 1 March, rates are based on pump prices of 151.1p/litre for diesel, 147.0p/litre for petrol and 78.2p/litre for LPG, and are as follows:

Petrol cars and vans:

Engine size	Average Efficiency	Cost per mile	AFR
Up to 1,400cc	52.7mpg	12.7p	13p
1,401-2,000cc	44.9mpg	14.9p	15p
Over 2,000cc	30.0mpg	22.3p	22p

Diesel cars and vans:

ENGINE SIZE	AVERAGE EFFICIENCY	COST PER MILE	AFR
Up to 1,600cc	63.6mpg	10.8p	11p
1,601-2,000cc	51.3mpg	13.4p	13p
Over 2,000cc	42.1mpg	16.3p	16p

LPG cars and vans:

ENGINE SIZE	AVERAGE EFFICIENCY	COST PER MILE	AFR
Up to 1,400cc	42.2mpg	8.4p	9p
1,401-2,000cc	35.9mpg	9.9p	10p
Over 2,000cc	24.0mpg	14.8p	15p

What are the mileage rates for electric and hybrid cars?

HMRC doesn’t class electricity as a fuel, so it took until 2018 to introduce a mileage rate specifically for electric vehicles. The Advisory Electric Rate (AER) is calculated similarly to an AFR, based on energy-efficiency data and the average cost of a unit of electricity at home. This is currently a flat rate of 5p per mile for all EVs.

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Hybrids still don’t have their own AFRs. All hybrids, including plug-ins, are reimbursed at the same rates as a petrol or diesel car, based on their engine size.

Can employers set their own rates? Yes, but it’s complicated. HMRC says businesses can adjust the rates if they’re leaving drivers out of pocket or the actual travel costs are much lower, which could be useful for plug-in hybrids. However, they have to provide evidence showing why that adjustment was needed, and any excess can be taxed.

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