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HMRC rules out AFR rate rise
HMRC has ruled out any review of its advisory fuel rate (AFRs) before the scheduled June 1 review.
This means that with fuel prices hitting a new record high, company vehicle drivers are being increasingly left out of pocket.
Many fleet analysts had been under the impression that if fuel reached a trigger point, at which prices rose more than 5% above the level at which AFR rates were calculated, the HMRC may reassess the rates prior to the scheduled six month review date.
Current rates, which came into effect on December 1, 2009, are based on a diesel rate of 109.9p per litre and petrol at 108.7ppl.
However, prices have risen consistently since HMRC set the rates, which are used to refund fuel used on business trips.
Phil Elms, National Sales Manager at Sandicliffe Motor Contracts commented, “There is a concern amongst certain fleets that if rates are not aligned better with rising fuel prices, drivers may be increasingly reluctant to undertake business travel on the basis that they are effectively having to subsidise their employer for every mile covered. However, HMRC has said that its rates are not binding if an employer can demonstrate that the cost of business travel in its company vehicles is higher than the guideline mileage rates.”
<< show all articles
HMRC rules out AFR rate rise
HMRC has ruled out any review of its advisory fuel rate (AFRs) before the scheduled June 1 review.
This means that with fuel prices hitting a new record high, company vehicle drivers are being increasingly left out of pocket.
Many fleet analysts had been under the impression that if fuel reached a trigger point, at which prices rose more than 5% above the level at which AFR rates were calculated, the HMRC may reassess the rates prior to the scheduled six month review date.
Current rates, which came into effect on December 1, 2009, are based on a diesel rate of 109.9p per litre and petrol at 108.7ppl.
However, prices have risen consistently since HMRC set the rates, which are used to refund fuel used on business trips.
Phil Elms, National Sales Manager at Sandicliffe Motor Contracts commented, “There is a concern amongst certain fleets that if rates are not aligned better with rising fuel prices, drivers may be increasingly reluctant to undertake business travel on the basis that they are effectively having to subsidise their employer for every mile covered. However, HMRC has said that its rates are not binding if an employer can demonstrate that the cost of business travel in its company vehicles is higher than the guideline mileage rates.”