Advisory Fuel Rates (AFR) changes for company car users effective from 1 December 2022

Advisory fuel rates (AFR) changes for company car users effective from 1 December 2022

The latest changes to advisory fuel rates 

The government has announced the latest changes to advisory fuel rates for company cars, which will come into effect from 1 December 2022. These rates are reviewed on a quarterly basis and are designed to ensure that companies can accurately reimburse employees who use their own vehicles for business purposes. Let's take a closer look at the changes that have been made and how they might affect you: 

Petrol and diesel cars 

The rate for petrol cars of all engine sizes is set to decrease by 1p per mile from 1 December 2022, while the equivalent rate for LPG cars will increase by 1p per mile. These changes are in line with recent economic trends. Diesel vehicles that have an engine size of either under or over 2000cc are unaffected and remain unchanged. 

Electric cars 

The rate for electric cars is set to rise from 5 pence to 8 pence per mile from 1 December 2022 onwards. This rate will be reviewed on a quarterly basis starting from the same date to ensure that it remains reflective of current market trends and conditions.

Alternative fuels 

The cost of other alternative fuels such as hybrid and LPG are also subject to change depending on the circumstances although it is expected that these changes will not significantly affect the overall landscape regarding advisory fuel rates as they tend to fluctuate less frequently than petrol, diesel and electric vehicles. 

These latest changes to advisory fuel rates will come into effect from 1 December 2022. Petrol vehicles of all engine sizes are set to see a decrease in rates while LPG cars will experience an increase. Electric cars will also become more expensive to run, but this cost is subject to review on a quarterly basis. If you use your own vehicle for business purposes, it's important to keep these changes in mind so that you can accurately calculate your expenses.

Getting the right information at the right time saves you money

Understanding all the changes that come out of HMRC is a full-time job, which is why you need an up-to-date accountant to keep you informed. Speak to David Masih, our client relationship partner who explain how On The Go Accountants can support your business to greater success. Call 03330 067 123 or email info@onthegoaccountants.co.uk.