Advisory fuel rates, often shortened to AFR, are the rates set by HMRC that UK employers can use to reimburse employees for business mileage in a company car, or to calculate how much an employee needs to repay for private fuel use.

They are not mandatory. Employers can use their own rates if they have evidence to justify them. But using HMRC’s advisory rates is the simplest and safest approach for most businesses, because as long as you pay no more than the published rate, there is no taxable benefit and no National Insurance liability to worry about.

HMRC reviews and updates the rates four times a year, on 1 March, 1 June, 1 September, and 1 December. The rates on this page reflect the most recent update. For the official published source, see the HMRC advisory fuel rates guidance on GOV.UK.

Advisory fuel rates apply only to company cars. They do not apply to employees using their own vehicles for business travel, where the approved mileage allowance payment (AMAP) rates apply instead.

These rates apply from 1 June 2026. The next scheduled review is 1 September 2026.

Petrol

Diesel

LPG

Electric

Hybrid cars are treated as either petrol or diesel for the purposes of advisory fuel rates, depending on the fuel type they run on.

You can use the previous quarter’s rates for up to one month after new rates take effect, giving businesses time to update their processes.

HMRC works out the advisory fuel rates using a combination of average fuel prices and average fuel efficiency figures for company cars.

For petrol and diesel, the fuel prices are taken from Department for Energy Security and Net Zero data. The miles per gallon figures are based on manufacturers’ information, weighted by annual business car sales over a three-year period.

For LPG, the same methodology applies but with a 20% reduction in MPG to account for the lower energy density of LPG compared to petrol.

For electric vehicles, the calculation uses electrical efficiency data from the Department for Transport, electricity price data from the Department for Energy Security and Net Zero and the Office for National Statistics, and for the public charging rate, price data from the Zapmap Price Index.

The rates are rounded to the nearest whole penny after calculation. HMRC publishes the full methodology alongside the rates on GOV.UK.

Advisory fuel rates apply in two specific situations.

Reimbursing employees for business travel in a company car. If an employee uses their company car for a business journey and pays for the fuel themselves, you can reimburse them using the advisory fuel rate for their engine size and fuel type. As long as you pay no more than the advisory rate, there is no taxable profit and no Class 1A National Insurance liability.

If your company cars are more fuel efficient than the HMRC average, or if your employees’ actual fuel costs per mile are higher than the published rate, you can use a different rate as long as you have evidence to support it.

Calculating private fuel repayments. If you pay for fuel that an employee uses for private journeys in a company car, you can use the advisory fuel rate to work out how much the employee should repay. As long as all private mileage is accurately recorded and the correct rate is applied, there is no fuel benefit charge to worry about.

What advisory fuel rates do not cover. They do not apply to employees using their own vehicles for business travel. In that case, the approved mileage allowance payment rates apply instead. They also do not apply to vans or other commercial vehicles.

If you are unsure which rules apply to your situation, the HMRC guidance on GOV.UK is the definitive reference, and your accountant or tax adviser can help you apply them correctly.

If your drivers use company fuel cards, the relationship between advisory fuel rates and your day-to-day fuel management is straightforward but worth understanding clearly.

When drivers use a fuel card, the cost of fuel is paid directly by the business. The advisory fuel rate is not relevant for the fuel card transaction itself, because the business is paying, not the driver.

Where advisory fuel rates become relevant is in two related situations:

Private mileage repayments. If a driver uses their company fuel card to fill up and then uses some of that fuel for private journeys, the business needs to calculate how much the driver owes back. The advisory fuel rate is the approved HMRC mechanism for that calculation. Accurate mileage recording is essential.

Business mileage in a personal vehicle. If employees occasionally use their own car for a business journey and claim back the cost, advisory fuel rates are one option for calculating the reimbursement, though approved mileage allowance payment rates are more commonly used in this situation.

The cleaner your mileage data, the easier both calculations become. Fuel Insights captures fuel transaction data automatically and feeds it into your reporting, giving you the foundation you need to track business versus private fuel use accurately. Combined with the visibility in The Fuel Store customer portal, your fuel card data and your mileage records can work together rather than being managed separately.

For guidance on reclaiming VAT on business fuel, see our fuel cards VAT and HMRC guide.

Hybrid cars are treated as either petrol or diesel for the purposes of advisory fuel rates, depending on which fuel type the vehicle runs on. There is no separate hybrid rate. Use the petrol or diesel table based on the engine type and size.

Fully electric cars have their own advisory rate, separate from the petrol, diesel, and LPG tables above.

The split between home and public charging rates reflects the significant difference in electricity cost between domestic and public charge points. For journeys where a company car has been charged at both locations, HMRC allows the mileage to be apportioned between the two rates on a fair and reasonable basis.

If the actual cost per mile for public charging is higher than the published advisory rate, a higher rate can be used as long as you have evidence to support it.

For businesses with electric vehicles in their fleet, the Paua EV Charge Card provides access to one of the UK’s largest public charging networks, with all charging tracked and invoiced in a way that makes the business versus private mileage apportionment much easier to manage.