Private Car/Company Fuel Benefit

wonka

Cash,

Are you sure? Yes I would have a lower benefit in kind... But why would I possibly have a lower mileage claim? The mileage I put on the P87 is purely business mileage, not personal + business. Whereas the fuel costs I am taxed on ARE for personal + business....

cash99

Wonka

If the fuel is paid by the employer and not reported as a benefit in kind then you have to reduce your mileage claim by the same amount. i.e. you can calim for wear and tear, insurance etc. but not fuel. You cannot claim a deduction for a cost paid by someone else.

Say your business fuel costs 10p per mile.

So BIK of 10p less mileage claim of 40p

or BIK of nil less mileage claim of 30p

The net position is the same in both cases.

The private fuel is a BIK and is taxable.

Mike241

All

I currently do exactly as wonka/grumman say, ie
pay tax at 40% on fuel (business and private) purchased on my fuel card,
claim back 40p for the 1st 10,000 business miles, and 25p for the remaining business miles.
but (unless I misunderstand it) if I was to hand back my fuel card I could
claim 9p (diesel) per business mile from my employer,
claim the difference between 40p/25p and 9p on my tax return.
That way I still get the 40p/25p back but without paying the tax in the first place!
The only downside, is that I'm paying for my private miles (which are few) out of my pocket.

Am I correct, or have I got this completely wrong?

Thanks
Mike

jennifernil

Mike......you only get to claim the tax relief on the 40/25p, not the whole 40/25p.

jennifernil

Obviously there is a difference depending on whether you have your own car or a company car, I can only comment on what happens if it is your own car.

OH gets a car allowance which is taxed as normal income. He also gets all his petrol paid for (except when he is on holiday). He buys the petrol on his own credit card then claims it back as (untaxed) expenses. The company pays him nothing more.

He keeps records of how many miles he drives on business and the amount received in petrol expenses. At the end of the year he works out whether his business miles x 40p is more or less than the company paid out and either pays the extra tax or reclaims the tax on the shortfall.

This year he had about 4000 business miles and 6000 private miles and ended up reclaiming tax on about £52.

The way wonka explained it was correct.

swollendrain

I have a privately owned 1.8ltr Diesel car.

The company I work for pays me a yearly car allowance paid monthly, and also pays me the for business miles @ 10p/pm.

What I find odd is that the company requests I give them a Fuel VAT receipt so that they can claim the VAT back on the mileage I have claimed for. Is this correct?

Pont

I work for the local authority. It is essential that I use my own car for work as I have to travel around to different clients houses (out in the sticks so no public transport) but strangly enough I'm not classed as an 'essential' car user! The result is I don't receive the yearly lump sum payment.
I am paid 30 per mile which is added to my salary and am therefore taxed on it. From my understanding I shouldn't be taxed on this as in effect I am paying tax twice - once at the pumps and once in my salary. I also understand that I can claim back the difference from what I am being reimbursed by my employer and the 40p allowance (approx. 10p per mile). Additionally I have to submit my petrol receipts so that my employer can claim back the VAT.
Anyway, have sent a letter to Inland Revenue asking them to verify the position so shall keep you posted.

mrklaw

Hi,

sorry for the huge bump, but this has been the most helpful thread in my seemingly never ending search for some sanity on the P87

It seems clear (and the HMRC just confirmed) that as a fuel card holder with my own car, I don't need to put anything down as 'payments received' from my company, just the simple miles x 40p thing, right?

that makes me wonder if I have to check my previous applications. two years ago I did complicated calculations about how much the company paid me for petrol, how much of that was for business miles etc, and then put that down as 'payments received'. is there any way to appeal/reapply for this, as it means my tax relief will be lower than it should be. (I applied last year but still haven't actually had any notification from HMRC)




Just for fun, and to complicate matters a little, my company changed their reporting last year. They only reported personal miles on the P11D - I had to let my company know what % of my petrol spend was business miles, and they left those off the P11D. so in that case I had to report the full petrol cost of those miles as 'payments received' right? (thats what I did)