The Advisory fuel rates are reviewed four times a year by HM revenue and customs and are recommended as a guide to reclaiming business mileage.
Advisory Fuel Rates from 1 March 2023
|Engine size (cc )
||Petrol – Pence per mile
||Diesel – Pence per mile||LPG – Pence per mile
|0 – 1400||13.0||13.0||10.0|
|1401 – 1600||15.0||13.0||11.0|
|1601 – 2000||15 .0||15.0||11.0|
|2000 and Over||23.0||20.0||17.0|
Please Note :
- Hybrid cars are treated as either petrol or diesel cars for this AFR purpose. HMRC has not issued AFR’s .
- The advisory electricity rate (AER) for plug-in cars remains unchanged at 9.0 ppm.
Source: HM Revenue & Customs August 2020
Vehicle Excise Duty rates from April 2020
The Government has announced that from April 1, 2020 and until March 31, 2025
‘expensive car supplement’. Presently all cars with a list price above £40,000 pay a £320 supplement, which increases to £325 from April 1, 2020, for five years from the second time a vehicle is taxed.
The Chancellor said that the move would incentivise the uptake of zero emission vehicles to support the phasing out of petrol and diesel model.
The Government has also published a call for evidence on Vehicle Excise Duty, which will include how it can be further used to reduce vehicle emissions.
The measure was signalled last year with the Government looking to introduce a more dynamic and granulated system which recognises smaller differences in carbon dioxide (CO2) emissions.
The call for evidence seeks views on how the Government could use Vehicle Excise Duty to further encourage the uptake of zero and ultra-low emission cars, and reduce overall emissions from road transport.
The aim of a revised system would be to eliminate the ‘cliff edges’ that currently exist between Vehicle Excise Duty bands. The call for evidence runs until June 3, 2020.
Vehicle Excise Duty ( VED ) registered from 1st April 2020
|VED Band||CO2 g/km||First year rate petrol cars and RDE2 standard diesel cars||First Year Rate For None RED2||
Alternative fuel cars
|B||1 – 50||£10||£25||£0|
|C||51 – 75||£25||£110||£15|
|D||76 – 90||£110||135||£100|
|F||101 – 110||£155||£175||£145|
|G||111 – 130||£175||£215||£165|
|H||131 – 150||£215||£540||£205|
|I||151 – 170||£530||£870||£530|
|J||171 – 190||£870||£1,305||£860|
|K||191 – 225||£1,305||£1,850||£1,295|
|L||226 – 255||£1,850||£2,175||£1,840|
Rates for second tax payment onwards for cars registered after April 1, 2017
|Fuel Type||12 Month Rate|
|Petrol Or Diesel||£150|
** Cars, excluding zero emission models, with a list price above £40,000 pay a £325 supplement for five years from the second time the vehicle is taxed.
Plug-in Car and Van Grants
The Chancellor confirmed an extension of the Plug-In Car Grant to 2022-2023 by making available a further £403 million and also providing an additional £129.5 million to extend the Plug-In Van Grant as well as those for taxis and motorcycles for the same period of time.
The Grants had been under threat, but the Chancellor bowed to industry lobbying and said that he recognised that the “market for ultra-low emission vehicles was still small”.
Looking beyond 2022-2023, the Chancellor said that the Government was “considering the long-term future of consumer incentives to support the transition to zero emission vehicles alongside the [on going] consultation on bringing forward the phase-out date for the sale of new petrol and diesel cars and vans from 2040”.
Following the Budget Statement, the Department for Transport and the Office for Low Emission Vehicles (OLEV) issued a note clarifying the extension of the Grants. However, it revealed that the existing zero-emission Plug-In car Grant of £3,500 would be cut to £3,000, while cars costing £50,000 or more would be excluded.
The change, said the Department and OLEV would “allow more drivers to benefit from making the switch for longer”. The changes come into effect immediately and, said the statement, the Government would “continue to keep the rate of grant under review”.
The Plug-In Car and Van Grants provide up to a maximum of £3,000 (previously £3,500) off the price of a zero emission car and £8,000 off the price of a plug-in van (large vans and trucks up to £20,000). The former was due to expire at the end of March, while there was previously no confirmed end date for the latter.
The Plug-In Car Grant was cut in October 2018 from £4,500 to £3,500 and plug-in hybrid vehicles were removed from the list of eligible models. The Plug-In Van Grant is available for vehicles that have CO2 emissions of less than 75g/km and can travel at least 16km (10 miles) without any CO2 emissions.
The Plug-In Car Grant was introduced in 2011 and the Plug-In Van Grant the following year.
Information obtained from www.Gov.uk and other sources
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