HMRC has updated its advisory mileage rates that allow businesses to reimburse employees for work related travel, or when employees are required to repay the cost of fuel used for private travel, in company cars.
Businesses are able to reclaim the VAT element on fuel mileage allowances providing they are close to HMRC’s own set fuel mileage allowance rates below.
|Advisory fuel rates from 1 June 2012|
|Rates per mile|
|Up to 1400cc||15p||11p|
|1401cc – 2000cc||18p||13p|
|1600cc or less||12p|
The rates are reviewed four times during the tax year any changes come into effect at the beginning of each quarter on 1 March, 1 June, 1 September and 1 December.
Employers may continue to use either the previous or new current rates for one month after the date of change.
Please contact us if you need help calculating mileage allowances.