December 2014 Advisory Fuel Rates (AFR's)

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December 1st saw the HM Revenue and Customs (HMRC) amend the advisory fuel rates paid to company car drivers.
Advisory Fuel Rates

HM Revenue and Customs has reduced one of the three diesel Advisory Fuel Rates (AFRs).

The rate for diesel cars with an engine size of over 2000cc has reduced from 17p to 16p.

HMRC has also reduced two of the rates for petrol cars. The rate for petrol cars with an engine size of 1400cc or less has reduced from 14p to 13p while the rate for  petrol cars with an engine size over 2000cc has been cut from 24p to 23p.

The full list of advisory fuel rates can be found on the gov.uk website.

The reduction in the AFR's can be attributed to a combination of falling fuel prices at the pumps and the continued increase in engine performance and efficiency.

What effect does this have on our pockets?

As employees, the majority of us will not see, or at least notice a difference. Although those who fall into the amended brackets will be paid less when reclaiming fuel, the loss is almost entirely covered by the reduction in fuel prices.

There is a group of individuals who are set to benefit from the AFR reductions. If your employer provides you with a fuel card and you pay back the cost of your private mileage to avoid fuel benefit tax, you will now be reimbursing your boss at a lower rate.