Advisory fuel rates for company cars changed from 1 June 2024

The amount that employers can reimburse staff for business travel in company cars changes from 1 June 2024. What are the new rates?

Advisory fuel rates for company cars are updated on a quarterly basis due to fluctuations in fuel prices. The rates determine the amount that can be paid to an employee using a company car for business mileage, without income tax consequences.

HMRC has now published the advisory rates applicable from 1 June 2024. The rates for diesel and petrol engines have increased, whilst LPG rates have remained static. The new rates are as follows:

From 1 June 2024

Engine size	Petrol — rate per mile	LPG — rate per mile
1400cc or less	14 pence	11 pence
1401cc to 2000cc	16 pence	13 pence
Over 2000cc	26 pence	21 pence

Engine size	Diesel — rate per mile
1600cc or less	13 pence
1601cc to 2000cc	15 pence
Over 2000cc	20 pence

Electric — rate per mile

8 pence

Hybrid cars are treated as either petrol or diesel cars for the purposes of Advisory fuel rates. These rates apply from 1 June 2024, but you can still use the previous rates for one month from that date.

Employees with fully electric vehicles and high mileage for June would be slightly better off if you use the rates for the current quarter (9p per mile), with diesel and petrol users better off using the new Advisory fuel rates.