Fuel card or not??

noodle944

Hi Folks

I have been offered a new job where they will provide me a monthly allowane for a car, rather than have a company car, but I don't know what to do about the fuel.. They have talked about getting me a fuel card, but I want to know what is the best way to reduce my tax liability???

I would really appreciate any help/advice..

Thanks in advance

N

noodle944

Incidenty I anticipate doing circa 25k miles per year of which 3k will be personal.

Thanks in advance.

Pablo_the_brave

noodle944 wrote: »

Incidenty I anticipate doing circa 25k miles per year of which 3k will be personal.

Thanks in advance.

Noodle,

Does not matter how many pivate miles you do. The equivelent cash benefit of having the fuel card is based on 2 figures. For tax year 2008/09 it is

£16,900 x a percentage figure based on the CO2 emissions figure. The £16000 is a set figure. The percentage figure is based on a table the HMRC use. The higher the CO2 the higher the percentage. You can do you own calculations here - http://cccfcalculator.hmrc.gov.uk/CCF0.aspx

Jinto

With so little private miles, it's almost certain that the tax you will pay will far outway the cost of buying your own fuel.

I use a company fuel card but pay back my private miles usage to the company at the agreed inland revenue rate (in my case 13p/mile). This way you avoid the hefty fuel benefit tax.

This is probably your best option if your company will allow it, However it does mean that you have to keep good records of your journeys.

The way we do it, is to log all business journeys then any mileage not accounted for is deemed to be private use.

cash99

Pablo_the_brave wrote: »

Noodle,

Does not matter how many pivate miles you do. The equivelent cash benefit of having the fuel card is based on 2 figures. For tax year 2008/09 it is

£16,900 x a percentage figure based on the CO2 emissions figure. The £16000 is a set figure. The percentage figure is based on a table the HMRC use. The higher the CO2 the higher the percentage. You can do you own calculations here - http://cccfcalculator.hmrc.gov.uk/CCF0.aspx

This is only applicable if you have a company car.

If you have a car allowance you will be taxed on the cost to your employer of the fuel provided through the fuel card. You can then claim 40p / 25p per mile in tax relief against this for any business miles you do. Based on your mileage that should result in a sizeable tax refund.

For private mileage you will pay tax on the cost so you private fuel will cost you a maximum of 40% of the actual cost.

Assuming that the car allowance will cover the non fuel costs of driving the mileage you anticipate then this is a good deal for you.

cash99

Jinto wrote: »

With so little private miles, it's almost certain that the tax you will pay will far outway the cost of buying your own fuel.

I use a company fuel card but pay back my private miles usage to the company at the agreed inland revenue rate (in my case 13p/mile). This way you avoid the hefty fuel benefit tax.

This is probably your best option if your company will allow it, However it does mean that you have to keep good records of your journeys.

The way we do it, is to log all business journeys then any mileage not accounted for is deemed to be private use.

Again this only applies if you have a company car, not a car allowance. Good advice otherwise as the tax on the benefit in kind can often exceed the actual costs of private fuel.

bootman

My husband has just changed jobs, where he has taken the car not the allownce and we have to buy all the fuel and claim back at a rate of 20p a business mile.

having had a fuel card for the last 10 years and repaid nominal private miles no card is not nice.

I am constantly nagging now, don't rev, don't race, done get in a traffic jam turn the a/c off.

I would not care if it was my own car or not but I would take to fuel card every time. You think you don't do may private miles, but they add up all the little trips here and there.

Jinto

It depends on your individual circumstances, with my car and my tax code doing 9000 miles a year, I am £550 a year better off a year, paying for my own fuel.
The AA website has a calculator

http://www.theaa.com/allaboutcars/companycartax/privatefuel_input.jsp?page=privfuel

But as Cash99 has pointed out, this may not be an option if you have a car allowance instead of a company car.

amf

The monthly allowance for the car will be taxed, so is irrelevant.

This is really a no brainer - the more in the way of fuel costs you can get your employer to pay (by way of fuel card or any other way you like), the better. Tax relief is only at 20% or 40%, depending on your marginal tax rate, whereas the company contribution is at 100%.