Car Business Mileage Rates have gone up – what are they now?

These changes only affect the fuel only rates, the business mileage rates are unchanged

Tax: rates per business mile

	First 10,000 miles	Above 10,000 miles
Cars and vans	45p (40p before 2011 to 2012)	25p
Motorcycles	24p	24p
Bikes	20p	20p

Its the Approved Mileage Rates that keep changing

From 1 September 2021

You can use the previous rates for up to 1 month from the date the new rates apply.

Engine size	Petrol – rate per mile	LPG – rate per mile
1400cc or less	12 pence	7 pence
1401cc to 2000cc	14 pence	8 pence
Over 2000cc	20 pence	12 pence

Engine size	Diesel – rate per mile
1600cc or less	10 pence
1601cc to 2000cc	12 pence
Over 2000cc	15 pence

From 1 June 2021 to 31 August 2021

Engine size	Petrol – rate per mile	LPG – rate per mile
1400cc or less	11 pence	8 pence
1401cc to 2000cc	13 pence	9 pence
Over 2000cc	19 pence	14 pence

Engine size	Diesel – rate per mile
1600cc or less	9 pence
1601cc to 2000cc	11 pence
Over 2000cc	13 pence

1 March 2021 to 31 May 2021

Engine size	Petrol – rate per mile	LPG – rate per mile
1400cc or less	10 pence	7 pence
1401cc to 2000cc	12 pence	8 pence
Over 2000cc	18 pence	12 pence

Engine size	Diesel – rate per mile
1600cc or less	9 pence
1601cc to 2000cc	11 pence
Over 2000cc	12 pence

1 December 2020 to 28 February 2021

Engine size	Petrol – rate per mile	LPG – rate per mile
1400cc or less	10 pence	7 pence
1401cc to 2000cc	11 pence	8 pence
Over 2000cc	17 pence	12 pence

Engine size	Diesel – rate per mile
1600cc or less	8 pence
1601cc to 2000cc	10 pence
Over 2000cc	12 pence

For hybrid cars you must use the petrol or diesel rate which may differ significantly from the actual fuel costs. The advisory electricity rate for fully electric cars is 4 pence per mile.

Employees should carefully consider whether it is advantageous having private fuel provided for their company car.  Remember that the P11d benefit for having private fuel provided for a company car in 2021/22 is £24,600 multiplied by the CO2 emissions percentage for that vehicle.

For example, a director driving a Mercedes Benz E200 saloon company car (CO2 emissions 169g per km) would be assessed on 37% = £9,102 for 2020/21. If they are a higher rate taxpayer that would mean £3,641 tax. That is an awful lot of private fuel!

steve@bicknells.net