Advisory fuel rates — are you using the current quarterly rates?

 

HMRC has updated its advisory fuel rates, effective from 1 September 2026 (rates are reviewed quarterly on 1 March, 1 June, 1 September and 1 December). If your employees use company cars, these are the rates to use when reimbursing business travel or asking employees to repay the cost of private fuel:

 

Petrol — 1400cc or less: 14p per mile; 1401–2000cc: 17p; over 2000cc: 27p.

Diesel — 1600cc or less: 15p per mile; 1601–2000cc: 16p; over 2000cc: 22p.

LPG — 1400cc or less: 11p per mile; 1401–2000cc: 13p; over 2000cc: 20p.

Fully electric — home charging: 7p per mile; public charging: 15p.

 

A few practical points. These rates are for company cars only — for employees using their own cars, the HMRC mileage allowance applies instead (45p for the first 10,000 business miles, 25p thereafter). Hybrid cars are treated as petrol or diesel based on engine size. If you pay above the advisory rate without evidence that the actual fuel cost per mile is higher, the excess is taxable and reportable. And when rates change, you may keep using the previous rates for up to one month. Worth a quick check with payroll before the next expense run.