HMRC Advisory Fuel Rates (AFR) from 1st December

HMRC Advisory Fuel Rates (AFR) from 1st December

The 1st December 2020 Advisory Fuel Rates (AFR) have been cut by 1p per mile for petrol vehicles with engines of 1400-2000cc, while the diesel amount per mile for vehicles across all engine sizes remains unchanged.

The rates can only be applied to:

  • reimburse employees for business travel in their company cars; or
  • require employees to repay the cost of fuel used for private travel.

The advisory electricity rate for fully electric cars is unchanged at 4p per mile. Electricity is not a fuel for car fuel benefit purposes.

When employees are reimbursed for business travel in their company cars, HMRC will accept there is no taxable profit and no Class 1A national Insurance to pay.

Advisory fuel rates from 1 December 2020

Engine sizePetrol – amount per mileLPG – amount per mile
1400cc or less10p7p
1401cc to 2000cc11p8p
Over 2000cc17p12p


Engine sizeDiesel – amount per mile
1600cc or less8p
1601cc to 2000cc10p
Over 2000cc12p

Hybrid cars are treated as either petrol or diesel cars for this purpose.

HMRC reviews rates quarterly on 1 March, 1 June, 1 September and 1 December.

HMRC Advisory Fuel Rates (AFR) from 1st December

UK Budget set for 3rd March 2021

Chancellor Rishi Sunak sets the UK Budget for 3rd March 2021

Rishi Sunak has described the Budget as ‘will set out the next phase of the plan to tackle the virus and protect jobs’.

Sunak become Chancellor in February 2020 after Sajid Javid’s shock resignation.  This will be Sunak’s second Budget after his first being 11th March 2020.

The March 11th 2020 Budget was heavily steered towards the government’s first response to the coronavirus pandemic, which focused on new jobs and business support with £30bn of commitments.

There was speculation there would be an autumn Budget but this did not happen although Sunak has provided both a ‘summer economic update’ and a ‘winter economy plan’, still focusing on Covid-19 support.

The spending review was held in late November, with Sunak emphasising the UK was facing an ‘economic emergency’, and revealing the economy is set to contract by 11.3%, the largest fall in over 300 years.

There has been no suggestion that of any planned tax increases or other means to reduce the government’s borrowing, which means that next years Budget will be the first time he can announce changes to the UK tax.