Reply to: £15 per 100 miles

[DaveB]

If you're running your own Ltd get on the Flat Rate Vat Scheme. No more worries about VAT claims etc and you should be better off as well. Saves me around £400 a month and no hassles calculating VAT on petrol etc.

[cojak]

*books 2 tickets in advance; 1 for Spamalot and 1 for Clog's PAYE investigation...*

[Clog II The Avenger]

£5 per mile

Take a tip from large companies and MPs. Register on offshore company, say in Panama zero at % tax. The offshore company specialises in car leases, chauffeur services and business accommodation. Pay your offshore company £5.00 per mile that will get you full UK tax befits. Withdraw the expenses via an ATM.

[Xtrain]

£80 per month

£80 per month is well worth claiming. If that was typical and going off the fact Parasol claim on their website over 10,000 members then that would add £9.6million to their coffers each year!!! Surely not.

Call me cynically but that is probably why they and all the other brollys are interested in their punters sending their VAT receipts in....

[VectraMan]

It would depend on your mileage. If your car is in the 16p fuel bracket (details on IR website) then you can claim 17.5% of 16p = 2.8p per mile (apologies in advance if this calc is not exact!). For e.g. if you do 500 miles a week then it is £14 a week / £728 per year. At that level then I would say yes it is worth claiming.

I was told it was a flat 2p per mile? Maybe that's older cars - will have to check with my accountant.

I worked out that with the 4 months I was with Parasol and doing nearly 1000 miles per week, they'd have been getting about £80 per month extra, which means they're making roughly double their advertised fee. Assuming you do lots of miles that is.

Presumably they also claim back VAT on other expenses like hotel stays?

On the one hand it's fair enough as they're doing what they advertised and refunding the expenses to you and it's not really your business how they're funded, and one of the reasons for using an umbrella is not to have to worry about stuff like VAT. But on the other hand, this had never occurred to me, and as a Ltd. that's extra money that can go towards your business profits rather than somebody else's.

[Xtrain]

Depends

This may seem a shock but is the VAT back on petrol claims worth all this hassle? I am prepared to just expense the mileage and not worry about the VAT just to save my admin time/costs.

It would depend on your mileage. If your car is in the 16p fuel bracket (details on IR website) then you can claim 17.5% of 16p = 2.8p per mile (apologies in advance if this calc is not exact!). For e.g. if you do 500 miles a week then it is £14 a week / £728 per year. At that level then I would say yes it is worth claiming.

[Millboy]

you will still receive the tax relief on the mileage covered, not the £15 petrol cost...

[Mustang]

Hassle

This may seem a shock but is the VAT back on petrol claims worth all this hassle? I am prepared to just expense the mileage and not worry about the VAT just to save my admin time/costs.

[Churchill]

my umbrella company has stated from april 5th i need to start producing reciepts. I work with loads of other contractors whose different umbrella comanies are asking for the same thing.

If this is real forget the 25p/40p a mile because 100miles divided by 15 quid is 15p a mile

Who's your umbrella?

Tell 'em to go and feck themselves! They are abusing the rules by trying to claim the VAT element of the fuel to which they are not entitled.

[swamp]

Looks again like Mr Brown is tightening the rules on us all.

Not quite. I believe this is an EU directive.

[Xtrain]

VAT re-claim

The rules on re-claiming of the VAT element of mileage allowance claims changed in January. This obviously only applies if you are VAT registered, not on the flat rate scheme and claiming mileage allowance (e.g. 25p/40p per mile).

To now claim the VAT, which is dependent on your car type (petrol, diesal, lpg) and engibne size), you need to provide a VAT receipt to back it up.

I presume the reason the umbrellas are now requesting receipts is so they can carry on claiming the VAT back and adding it to their profits. For e.g. if you've got 2000 contractors and can claim £100 on each it is certainly worth it!

Looks again like Mr Brown is tightening the rules on us all.

[DaveB]

my umbrella company has stated from april 5th i need to start producing reciepts. I work with loads of other contractors whose different umbrella comanies are asking for the same thing.

If this is real forget the 25p/40p a mile because 100miles divided by 15 quid is 15p a mile

Yet another reason to ditch the umbrella go with your own LTD. That plus getting on the Flat Rate Scheme for VAT and the whole problem goes away.

[Fleetwood]

a) receipts
b) 15p a mile is fuel costs. Surely the tax-man will accept that there are other costs associated with running a motor????

[Wildybeast]

my umbrella company has stated from april 5th i need to start producing reciepts. I work with loads of other contractors whose different umbrella comanies are asking for the same thing.

If this is real forget the 25p/40p a mile because 100miles divided by 15 quid is 15p a mile

[swamp]

Doesn't matter if you're flat rate VAT.