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ACFO launches petition for HMRC advisory fuel rates for electric cars

Plug in hybrid model being charged

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1 May 2018

ACFO has launched a petition requesting HMRC publishes Advisory Fuel Rates for plug-in cars.

Currently there are no defined mileage reimbursement rates for 100% electric vehicles, range extended electric vehicles, and plug-in hybrid petrol and diesel models.

ACFO says this is a handicap to some businesses that wish to include plug-in vehicles on their company car choice lists.

The petition has been launched on ACFO’s website: www.acfo-org.

Launch of the petition follows an ACFO hosted fleet industry summit last year. This included representatives of the BVRLA, contract hire and leasing companies, motor manufacturers producing plug-in vehicles, and fleet managers operating zero emissions and plug-in hybrid cars.

Following the summit, ACFO submitted a range of considerations to HMRC that included:

  • Advisory Fuel Rates for cars with a battery capacity up to 40kWh and above 40kWh – 4p and 5p a mile respectively
  • Advisory Fuel Rates for plug-in hybrid petrol cars linked to electric mileage range and current engine capacity-based Advisory Fuel Rates for petrol cars – reimbursement rates ranging from 5p to 19p a mile.
  • Advisory Fuel Rates for plug-in hybrid diesel cars linked to electric mileage range and current engine capacity-based Advisory Fuel Rates for diesel cars – reimbursement rates ranging from 5p to 12p a mile.
  • Range extended electric vehicles – calculated using above figures based on 90% electric mile range and 10% petrol/diesel mileage range using appropriate Advisory Fuel Rate figure.

The calculations follow a similar format to that used by HMRC to compile Advisory Fuel rates for petrol, diesel and LPG cars and include: mean battery capacity from manufacturers’ information, weighted by available models and average battery capacity (kWh); electric mileage range adjusted downwards by 15% to take account of real driving conditions and impact on manufacturers’ stated range; average battery recharge cost.

Advisory Fuel Rates for plug-in hybrid petrol and diesel models utilise the current Advisory Fuel Rates bandings based on engine capacity and are adjusted for electric mileage range: the greater the zero emission mileage range of a vehicle the lower the reimbursement rate.

Advisory Fuel Rates apply where employers reimburse employees for business travel in their company cars, or require employees to repay the cost of fuel used for private travel. Published quarterly, they provide a range of rates based on engine size and fuel type (petrol, diesel or LPG), and when used, are deemed to be tax-free.

 

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Ralph Morton

Ralph Morton

Ralph Morton is an award-winning journalist and the founder of Business Car Manager (now renamed Business Motoring). Ralph writes extensively about the car and van leasing industry as well as wider fleet and company car issues. A former editor of What Car?, Ralph is a vastly experienced writer and editor and has been writing about the automotive sector for over 35 years.

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