Business mileage claim

[vora]

Hi everyone,

First year in contracting and have couple of questions regarding claiming the business mileage. Hope someone will be able to clarify for me. Thanks in advance

I have my own car but I have been paying for the fuel from business account directly for few months which was not much as I was not doing many miles. Then i realised that if i pay from my own pocket but then claim back the mileage that will be more money. So I have started paying from my own account and keeping a log of my daily business commute miles.

1. Can I add all the miles up (including the time I was paying from company account) and calculate the total mileage amount, then deduct what I have already paid from company account and claim that or should I not claim any money for the time I have been using business account for paying for the fuel and should only claim for the time I have been paying from my own pocket?

2. When can I actually withdraw the mileage amount from business account to my own account? Is that normally at the end of year or you can do it any time?

Thanks

[Jessica@WhiteFieldTax]

1 - strictly, no; you are in a pickle. In practice, yes; you would be unfortunate if this adjustment came back to haunt you.

2 - anytime, but be sensible. Monthly, maybe. Could be weekly, but daily would be unusual. No rules on number / time if withdrawal, so long as it is after incurring the mileage.

Ask your accountant how they prefer to deal with both issues.

[vora]

1 - strictly, no; you are in a pickle. In practice, yes; you would be unfortunate if this adjustment came back to haunt you.

2 - anytime, but be sensible. Monthly, maybe. Could be weekly, but daily would be unusual. No rules on number / time if withdrawal, so long as it is after incurring the mileage.

Ask your accountant how they prefer to deal with both issues.

Thanks for your reply Jessica, just to clear my understanding, I should still be able to claim for the time when i am not paying from company account though?

p.s. my accountant - learning the hard way, he is not much of a use as i have found in few previous instances as well. Will look to move away from him next financial year

[AMH]

i done this at the start as I was going to sell my car to the business.
Then changed my mind & creatively put all the fuel transactions in as a director loan (I was owed quite a bit in director loan for startup costs)

I do my expenses monthly with my payroll.

[Project Monkey]

i done this at the start as I was going to sell my car to the business.
Then changed my mind & creatively put all the fuel transactions in as a director loan (I was owed quite a bit in director loan for startup costs)

I do my expenses monthly with my payroll.

+1

Record everything you paid yourself for fuel as a directors loan, then pay it back in full. Next, draw up a record of all your business mileage and re-claim from your company at 45p/mile (assuming total is under 10,000 miles).

Just make sure all transactions are in the same financial year and you should be fine.

[vora]

Thank you both - This sounds like the best way to come out of this situation.

It funny though I'll be giving this idea to my accountant rather than he coming up with some solution. Credit goes to this forum.

Thanks again.

[TheFaQQer]

p.s. my accountant - learning the hard way, he is not much of a use as i have found in few previous instances as well. Will look to move away from him next financial year

Move now before it gets too bad. Waiting until there are numerous cock ups to fix will take someone a lot of time and effort next year.

Give InTouch a call before it's too late - tell them I sent you their way and get freebies

[Eirikur]

yes. get another accountant now don't wait for the end of your fiscal year