HMRC updates advisory fuel rates from 1 March 2026

AFRs are used where employers reimburse employees for business travel in company cars, or where employees repay the cost of fuel used for private travel. Reimbursements at or below the advisory rate are not treated as taxable earnings and do not incur NI. The rates applying from 1 March 2026 are as follows (previous rates in brackets where changed):

Petrol and LPG

Engine size	Petrol	LPG
1,400cc or less	12p	10p (11p)
1,401cc to 2,000cc	14p	12p (13p)
Over 2,000cc	22p	19p (21p)

 

Diesel

Engine size	Diesel
1,600cc or less	12p
1,601cc to 2,000cc	13p
Over 2,000cc	18p

 

Electric

Charging location	Rate
Home charger	7p
Public charger	15p (14p)

Petrol and diesel rates remain unchanged, but LPG rates have reduced across all engine sizes. The advisory electric rate for public charging has increased to reflect higher charging costs. Employers may continue to use the previous rates for up to one month after 1 March 2026. Payroll and expense systems should now be updated to ensure the correct rates are applied. Where reimbursements exceed the advisory rate, employers must be able to demonstrate that the higher amount reflects the actual cost per mile to avoid income tax and NI implications.