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Good news for electric car drivers, but cuts for other car users

The rates for which company car drivers can claim back fuel cost is changing from March 1st.

HM Revenue & Customs (HMRC) has announced that the way the advisory electricity rate (AER) is calculated has been changed to better reflect energy prices, particularly with soaring electricity costs, when it is reviewed quarterly.

The new rates include a 1 pence per mile (ppm) increase in the advisory electricity rate (AER) used to reimburse drivers of electric company cars.

However, petrol, diesel and LPG advisory fuel rates (AFRs) have been reduced from 1 March.

Rates reduced for petrol and diesel

The rates for petrol company cars have all been cut, with the AFR for petrol vehicles up to 1,400cc now 13 ppm.

Vehicles powered by 1,401-2,000cc engines see a decrease of 2 ppm, to 15 ppm. For engines larger than 2,000cc the AFR sees the biggest reduction of 3 ppm, to 23 ppm.

For diesel, cars up to 1,600cc there is a reduction of 1 ppm, to 13 ppm, and engines from 1,601-2,000cc see a reduction of 2 ppm to 15 ppm. The 2,000cc rate is cut by 2 ppm to 20 ppm.

For LPG vehicles up to 1,400cc, the rate remains the same at 10 ppm but has been cut by 1ppm to 11ppm for vehicles with an engine size of 1,401-2,000cc. For engines greater than 2,000cc, there is also a reduction of 1 ppm to 17 ppm.

Hybrid cars are treated as either petrol or diesel cars for AFR purposes.


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