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HM Revenue & Customs has advised that there are new "Advisory Fuel Rates" which will have effect from tomorrow, 1 June 2010.

These "fuel only" rates can apply where:

1. employers don't pay for employees' fuel in their company cars but want to reimburse for business mileage; or
2. employers do pay for all of the employee's fuel but want to avoid the private fuel benefit, so the employee reimburses for all private fuel at the 'advisory rate'

Note that the scale rates for the engine capacity for diesel-engined cars now differs to that of petrol or LPG cars:

HMRC has also announced a change of policy as regards updating these rates: in the past, it was whenever fuel prices increased by more than 5%. Given the rate at which fuel prices are currently increasing, HMRC has now decided to fix the reviews on a quarterly basis, no matter the change in fuel prices in the interim. HMRC is now asking all employers to check their website in February, May, August and November for updates on the advisory rate to be applied:

Company Cars - Advisory Fuel Rates

It should be borne in mind that these rates are not mandatory - for instance, an employer may be able to justify a higher rate of reimbursement if the vehicles used in that business actually consume more fuel per mile. Further information can be found at Company Cars - Advisory Fuel Rates for Company Cars