Claiming VAT on Fuel

[Pip in a Poke]

Been pondering this because of the upcoming VAT changes.

Currently I claim 45p per mile for the first 10,000 business miles. I actually don't do many business miles but I do a lot of personal mileage.

So, my question is this. When claiming VAT on fuel, can I literally just claim VAT every time I fill up at the pump or do I have to work out which proportion of the fuel spend has been for business miles and claim accordingly?

If it's the former, I'll be looking at getting off the FRS.

[Yorkie62]

My understanding from my accountant is that you can claim the vat on the fuel element of the 45p per mile rate, I. E. VAT on 11p per mile.

[northernladuk]

Why don't you ask your accountant or Google it rather than trolling prof forums?

https://www.concur.co.uk/newsroom/ar...w-it-works-now

[MrMarkyMark]

FTFY

Been pondering this because of the upcoming VAT changes.

Currently I claim 45p per mile for the first 10,000 business miles. I actually don't do any business miles and also no personal mileage.

So, my question is this. When claiming VAT on fuel, can I literally just claim VAT every time I fill up at the pump or do I have to work out which proportion of the fuel spend has been for business miles and claim accordingly?

If it's the former, I'll be looking at getting off the FRS.

[LondonManc]

There are three general points on fuel for business:

1/ You claim mileage for business mileage as you currently are; VAT clawback going up from14.5% to 16.5% hasn't changed the rules on that. I'm sure my accountant would have advised that I'd be better ditching FRS given the mileage I've done this year!

2/ If it's a rental car that you're using, you'd claim for the fuel used; generally, rental cars are receive full, return full, so simply keep the receipt from when you top up at the end.

3/ If you can charge business mileage back to the client, you add the VAT to it, but it must be business mileage (at whatever rate you can charge, e.g. 60p+VAT).

[Patrick@Intouch]

You won't be able to claim anything for VAT on mileage under the flat rate scheme.

If you are registered under the standard scheme for VAT then you should calculate VAT by reference to the advisory fuel rates published by HMRC

https://www.gov.uk/government/public...m-1-march-2016

[MPwannadecentincome]

You won't be able to claim anything for VAT on mileage under the flat rate scheme.

If you are registered under the standard scheme for VAT then you should calculate VAT by reference to the advisory fuel rates published by HMRC

https://www.gov.uk/government/public...m-1-march-2016

But the advisory fuel rates relate to employee use of a company car.

If you use a private car for business mileage you can claim upto 45p per mile as the personal owner of that car from the Ltd Co, the person cannot reclaim the VAT. About 20 years ago I remember claiming as the Ltd Co the VAT on the mileage rate which then went into the company's coffers so gets treated as profit, not sure if that is still allowed.

Certainly you have to verify that the mileage is for business purposes only you can't claim the whole tank of fuel.

LondonManc
2/ If it's a rental car that you're using, you'd claim for the fuel used; generally, rental cars are receive full, return full, so simply keep the receipt from when you top up at the end.

Again you have to verify that the complete mileage used on the car rental is business purposes only, any personal element of the car rental and corresponding mileage charge needs to be re-imbursed back to the company to prevent a personal tax charge.

[Jessica@WhiteFieldTax]

But the advisory fuel rates relate to employee use of a company car.

One of those annoying situations where you know something, but can't prove it... ...ten minutes of painfully navigating .gov.uk later...

https://www.gov.uk/hmrc-internal-man...t-tax/vit55400

HMRC officers may check what rates employers have used to calculate claimable input tax on the fuel element of mileage allowances paid to their employees. Current rates as published by motoring associations such as AA or RAC are generally acceptable. HMRC will also accept HMRC’s own advisory rates which are published twice a year and can be found atCompany Cars - advisory fuel rates.

HMRC will accept the advisory fuel rates as indicative of the fuel element of Authorised Mileage Payments (the 45p pm x 10k) - Despite is saying in the notice appendd to them they only apply to company cars.

You need to have VAT receipts to cover on a £ for £ basis the vat claimed:

eg - if vat element of a quarters mileage was £20 and you filled up 12 times in the quarter, you don't need 12 receipts, just receipts with £20 of vat on them (don't blame HMRC, the EU came up with that one)

@OP

No, you can't claim on each fill up per se.

You have to apply the advisory fuel rate or another approximation of fuel per mile to each mileage claim you make. You can only do this outside of FRS.

[northernladuk]

Ended up a pretty good thread for something that didn't/won't/never happened.

[MPwannadecentincome]

Ended up a pretty good thread for something that didn't/won't/never happened.

Was worthwhile for me - thanks to Jessica@WhiteFieldTax I now remember how I operated this 20 years ago so can use this again from April