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AFR_and_AMAP
AFRs have dropped slightly from December 1. You should start using the new rates from January 1 – HMRC allows a 1 month change-over

THE latest official pence per mile figures were announced from 1 December 2013.

And if you run an SME small fleet and haven’t started using them yet, then you should from the beginning of January – HMRC allows employees to use the old rates for one month from the changeover date if required.

The pence per mile figures are for company car drivers to either claim business mileage or reimburse private mileage when all fuel is paid for – such as when companies issue all company car drivers with a fuel card.

Know as Advisory Fuel Rates or AFRs, company car drivers can avoid paying tax on free fuel  by using AFRs.

The new company car business mileage rates are listed below.

 

Petrol: New company car business mileage Advisory Fuel Rates from 01 December 2013

  • Engine size 1400cc or less: 14p down from 15p
  • 1401cc to 2000cc: 16p – down from 18p
  • Over 2000cc: 24p – down from 26p

 

Diesel: New company car business mileage Advisory Fuel Rates from 01 December 2013

  • Engine size 1600cc or less: 12p
  • 1601cc to 2000cc: 14p – down from 15p
  • Over 2000cc: 17p – down from 18p

 

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1 COMMENT

  1. There is general confusion in our company about claiming back allowance for company car business miles. I have called HMRC twice about it and had somewhat conflicting responses. As I understand it, I am paid 15p (last year)/mile for business miles travelled in my company car in which I pay for the fuel but if I complete a P87 form I can get back the difference between 45p allowance and 15p already paid. Is this correct and legitimate without placing myself in the sites of the HMRC for future investigation? Not paranoid, just practical.

    Editor’s note
    Hi Michael, there is confusion here. There are two types of pence per mile claims you can make, depending if you have a company car or a private car you use on business.

    For a company car used on business – your case – you use the Advisory Fuel Rates or AFRs. These recompense you for fuel paid by yourself on business. They can be claimed back from your employer but are dependent on engine type (petrol or diesel) and engine size. In this way there is no fuel benefit incurred. You cannot make a claim using the P87 form.

    If you use your private car on business, then all business trips can be claimed for at the rate of 45p per mile for the first 10,000 miles, 25p thereafter. These are known as Approved Mileage Allowance Payments or AMAPs for short. The payment is intended to cover such items as business insurance, wear and tear and so on for the business element of your mileage.

    For further help you should read our How To guide to Claiming Your Business Mileage.

    Ralph Morton, editor

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