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Post Info TOPIC: Claiming VAT Back on Mileage


Veteran Member

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Claiming VAT Back on Mileage


Hi,

the directors of the company I work for have calculated their mileage for the last financial year and I've been told that if I have VAT receipts for the fuel they purchased then I could use these to claim back the VAT on the mileage.† Is this correct?† If so, how do I show this in the accounts (I use Liberty).

Any help will be much appreciated.



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Forum Moderator & Expert

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Hi Eva,

If we are talking here about the mileage rates (45p/25p for this year or 40p/25p for last year) then VAT is reclaimable only on the mileage part of the mileage element of the allowance.

See here for the current apportionment of the allowance that is attributable to Petrol :

http://www.hmrc.gov.uk/cars/advisory_fuel_current.htm

For example, for a petrol car under 1400cc only 15p of the 45p is related to the cost of fuel.

Here's the link to the historic rates as you will need the figure for last year :

http://www.hmrc.gov.uk/cars/advisory_fuel_archive.htm

So, assuming 15p per mile the VAT that you would be able to claim : at 17.5% for last year (*7/47) = 0.02234 per mile VAT and at 20% for this year (*1/6) that would be 0.025p per mile VAT

That means at current rates 10k miles in a 1400cc car would be a payment of £4500 and VAT of £250... Probably not what the directors were actually expecting!

P.S. edited because just realised that I had inadvertently left a sentence in from my original draft of the reply that was no longer applicable in the finished draft.



-- Edited by Shamus on Monday 6th of June 2011 01:50:06 PM

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Responses are not meant as a substitute for professional advice. Answers are intended as outline only and in all situations the advice of a qualified professional should be sought before acting on any response given.



Veteran Member

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Thank you very much - that actually makes sense!

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Senior Member

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Hi, just checking, would claiming back the VAT in this way make the car subject to the fuel scale levy?

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Senior Member

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Hi there, I think that if they are using the amount per mile rate for business use, i.e 45p or 25p then no scale charge is needed, it is only needed if claiming petrol/diesel†receips which include a personal element on this.† But would appreciate other thoughts on this as I am not 100% sure.† Julie



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Julie



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Hi there,

Yes, Julie is right. If you use your car for business and private use and you don't want to go to the bother of recording private mileage, you claim back all the VAT on your petrol receipts but you then pay the fuel scale charge, dependent on the emissions of the vehicle, to compensate for the private fuel use.

Pauline



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Pauline

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