VAT on Fuel?? - The Book-keepers Forum (UK)

Gav · Member

VAT on Fuel??

luther parker · Veteran Member

Hi there,

As long as this is business related, then yes, you can claim VAT on fuel

In her own time, then no it would go into her Dividend account if she has one T9

That's right she can not claim mileage...if VAT reg.

She can not even claim food snack or drink receipts for herself either (unless you are in a meeting with a client in a resturant) as HMRC would simply turn around and say 'What's wrong with a Pack- Up'.

You are paying expenses, so the expenditure is not a business expense.

Luther.

RobH · Expert

Hi Gav,

Yes she can claim the input tax for the whole of the fuel expense, both private and business as long as you (as you say) apply the relevant scale charge. The VAT due per the scale charges should be included in the total output tax figure at box 1 and box 3 of the VAT return. The net amount (ie the scale charge for the fuel less the VAT due) should be included in the value of net total outputs at Box 6.

I think Luther is correct to say that if you claim just for the business use then you do not need to apply the scale charge but you must have very clear records of what is private and what is business and not just a basic 10% private. She won't have a dividend account though as she is self employed.

Rob

luther parker · Veteran Member

Ow yes shes self employed, I missed that...thanks Rob.

Quentin Pain · Senior Member

Your client has 3 choices:

1. Record every business trip and reclaim the mileage allowance. You can also claim back a small amount of VAT from the business mileage. Make sure you have receipts (although HMRC accept that just about all fuel companies are VAT registered!). The amount of VAT you can reclaim varies depending on engine size. VAT 700/64. Here are the published fuel prices: http://www.hmrc.gov.uk/cars/advisory_fuel_current.htm so divide your car size by the VAT rate and you get the deduction (eg. 1400cc is 12p, so the VAT reclaimable on a 40p allowance is 12 divided by 1.175 minus 12 = 1.79p).

2. Claim back all the VAT and pay the scale charge. This is the most common method since it requires no mileage records to be kept, just a fixed amount to pay each quarter. If hardly any business miles are done, then method 1 may be more beneficial. Add up the total VAT and see if it is more than the scale charge.

3. Keep detailed records of all trips and figure out the business percentage. Only enter that percentage of fuel receipts and claim back only the same percentage of VAT.