ACFO questions new Advisory Fuel Rates

ACFO has questioned why new Advisory Fuel Rates (AFRs) have not changed for diesel powered cars with an engine size between 1,601cc and 2,000cc.

Her Majesty’s Revenue and Customs (HMRC) published new AFRs last week with a 1p per mile increase for diesel fuelled cars over 2,000cc and 1,600cc or less.

However, with the majority of fleet cars sitting in the unchanged bracket, ACFO is concerned that many company car drivers are going to be left short changed.

ACFO chairman Julie Jenner said if the same applied mpg figures, which are adjusted downwards by 15% to take into account real world driving conditions and lower fuel economy for older cars, have been used since last September for diesel cars, why has the 1,601-2,000 pence per mile rate not increased.

She said: “Given that diesel is now 2ppl higher than it was when the rates were last reviewed in December - 143.2 compared to 141.1 - why have only the lower and upper bands increased by 1p and not the 1,601-2000 band where most fleet vehicles sit?

“If it costs more in the other two bands, why does it not in this one?”

She continued: “Whilst I appreciate we only have to live with any changes for three months it is clear that fuel is at record high prices and this should be reflected in the review.”

The AFR review comes after diesel hit a record high of 143.35ppl and petrol followed suit with a new record pump price of 137.44ppl.

The new AFRs, which businesses use to repay drivers for fuel used on business mileage, took effect from Thursday (March 1) and are reviewed on a quarterly basis.

Petrol and LPG rates remain unchanged from the last change in December. However, there is a 1p per mile rise for diesel cars with engines smaller than 1,600cc and for those larger than 2,000cc.

Petrol
1400cc or less 15p (15p)
1401cc to 2000cc 18p (18p)
Over 2000cc 26p (26p)

Diesel
1600cc or less 13p (12p)
1601cc to 2000cc 15p (15p)
Over 2000cc 19p (18p)

LPG
1400cc or less 10p (10p)
1401cc to 2000cc 12p (12p)
Over 2000cc 18p (18p)