The cost of rising fuel prices

The recent item on advisory fuel rates noted HMRC’s announcement that the month’s notice of rate increases that has previously been given will be withdrawn.

HMRC’s press release says that ‘employers making or collecting payments at the superseded rate because they have not been able to change their systems in time should make or require a second payment in respect of the same period in order to apply the new rate from its effective date’.

From this HMRC clearly expect rates to increase in future. However George Bull commenting on the change picks up on the benefit that might arise if excess payments to employees are not recovered in a situation where fuel rates are falling.

However this ignores the much more likely situation of employees reimbursing for private mileage at a historical rate when the current statutory rates have increased. As HMRC’s...