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HMRC confirms new AFR rates and changes

Date: 27 May 2011

HMRC has announced new advisory fuel rates from 1 June and confirmed changes to the way AFRs are calculated.

Diesel will now fall into three brands - 1600cc or less at 12p, 1601cc to 2000cc at 15p and over 2000cc at 18p. Previously there were only two bands - below and above 2000cc.

Meanwhile drivers with petrol-engine cars below 1400cc can claim 15p per litre, previously 14p, 1401cc to 2000cc is 18p, formerly 16p and over 2000cc is now 26p, up from 23p.

HMRC confirmed that rates would now be reviewed every quarter with changes at the beginning of each calendar quarter. However, this move means it will no longer consider changing the rates if fuel prices fluctuate by 5% from the published rates.

Calculations for the new rates also relies on an reconsidered mpg, with HMRC adjusting downwards mpg by 15%, rather than 10%, to take into account of real driving conditions and lower fuel economy for older cars. This is the same figure as used by the Energy Saving Trust.

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