Using Own Car for Work and Fuel Card

MrMRJ

Hi,
I hope this is the correct section.
In previous jobs I have recieved a car allowance to cover the cost of the car and then claimed Business mileage at 45p/25p rate. In my new job however I have been provided with a fuel card. A small fixed amount is deducted from my salary each month to cover private fuel use.
I believe however doing it this way I am financially worse off than the previous way.
I know the employer doesn't pay the full rate you can claim the difference from HMRC. However how would I go about this using a fuel card and not receiving a set amount per mile.
I also use 2 different Cars for work.
Come the end of the tax year I would like to be able to claim the difference of Business fuel provided and the 45p mile rate. 
I am also keen not to raise any questions to the company from HMRC as I am not fully sure if the way they are doing it is legit in the eyes of HMRC.
I appreciate any advice.

Jeremy535897

I would assume that your claim would be for the 45p/25p amount, less the amount spent by you on the fuelcard (adjusted for the deduction from salary). If you did 1,000 business miles and were within the 45p band, spent £200 on fuel (for all mileage), and £20 was deducted from your salary, your net claim would be £450- £(200-20)=£270. If the employer treats the £180 as a benefit in kind, you would claim the £450.

Grumpy_chap

I had a private car (took the car allowance instead of company car) but kept the fuel card and the way it worked was as follows:
 - Fuel card subject to income tax at the cost of whatever was spent on it (less the amount "made good" deduction towards private mileage)
 - Kept records of business mileage
 - Claimed through tax return for business mileage at the 45p / 25p rate.
I think that is the same as Jeremy says, just expressed differently. 

I did this for a number of years from around 2004 until 2010 and never had any queries or challenge from HMRC or my Accountant (who was the one doing my tax return submissions in any case).  I know my claims were a number of years back but I do not believe there have been any changes in the rules in this regard.

The difference between what I did and what the OP has is that my employer at the time never made a deduction for private mileage.

I note the deduction for private fuel use is a fixed amount and not related to AMAP, but if the calculation is done as I have set out, I don't think the variance from AMAP is relevant.

There was a recent thread where the same query was discussed and the OP may find it helpful:
https://forums.moneysavingexpert.com/discussion/comment/77493005#Comment_77493005

MrMRJ

Thank you both for your replies but I think what makes mine a bit tricky is that i do not pay tax on the fuel card as a benefit in kind, the £30 deducted from salary is supposed to cover this.
Even if in the month I did 1000 private miles it would still be £30.

I would of thought my claim would be calculated by the difference of the mileage rate published by HMRC for company car users which is around 12p/mile to cover just fuel 45-12=33p per mile.
Problem is I have no way of providing receipts to HMRC to show I have paid for my private mileage.

Maybe the best option is for me to talk to my employer about not using the fuel card 🤔 

Grumpy_chap

MrMRJ said:

Thank you both for your replies but I think what makes mine a bit tricky is that i do not pay tax on the fuel card as a benefit in kind, the £30 deducted from salary is supposed to cover this.
Even if in the month I did 1000 private miles it would still be £30.

That is a complication.  It is beholden upon your employer to correctly record any benefits received and declare them on your P11D.

Do you have a car allowance paid instead of a company car?

If the employer is saying they give you a fuel card and you use your own car but the employer does not make good any other costs of motoring that does not seem correct.  The cost of running a car if far higher than the cost of simply the fuel, even HMRC recognise that with the 45p / 25p mileage rates and the separate AMAP rates for fuel only.

Your idea of 45p / 25p less the AMAP rate seems like a reasonable approach.  The challenge is that not only do you not have evidence of "making good" private fuel, you also do not have evidence of the taxable benefit of the fuel card.

It sounds like this is a new scheme at your workplace and may be something to resolve once the year-end P60 and P11D is provided.  You may not be paying tax as you go on the fuel card, but it would be very unlikely that the company does not correctly declare the benefit received in the P11D.  At that point, you do your tax return and revert to the approach outlined earlier:
 - tax on fuel card less amount made good (the deductions of £30 shown on each monthly payslip)
 - counter-claim business mileage at 45p / 25p rates.

Jeremy535897

I had a private car (took the car allowance instead of company car) but kept the fuel card and the way it worked was as follows:
 - Fuel card subject to income tax at the cost of whatever was spent on it (less the amount "made good" deduction towards private mileage)
 - Kept records of business mileage
 - Claimed through tax return for business mileage at the 45p / 25p rate.
I think that is the same as Jeremy says, just expressed differently. 

Yes (I actually expressed it both ways, either as a claim for £270 on my figures, or a claim for £450 but a BIK or salary of £180, depending on what the employer does).

This has to be the right way of doing it. The amount the employer expends on the fuelcard, less the recharge to salary, is simply a payment towards the mileage allowance of 45p/25p. If they just paid 12p a mile with no fuelcard or salary deduction, then you would claim 33p/13p. But this is not what they do, so you can't just pretend otherwise.

MrMRJ

But the fuel card is not a taxable benefit if you pay for your private fuel, so technically there won't be 'evidence' of this because there is no benfit as I assume the £30 deducted is show HMRC I am paying for private fuel (by the way I don't do many private most months the £30 would cover this)

Yes I do recieve £450/month car allowance.

I only started at this company recently so really don't wont to upset how they do things just yet.

Grumpy_chap

The OP has the difficulty that the scheme appears to be new and possibly incorrectly administered on the 'here and now' rolling basis. 
The OP Has to assume that year end tax documentation will be correct.  

Thrugelmir

MrMRJ said:

Problem is I have no way of providing receipts to HMRC to show I have paid for my private mileage.

Are you maintaining a mileage log? 

MrMRJ

Jeremy535897 said:

I had a private car (took the car allowance instead of company car) but kept the fuel card and the way it worked was as follows:
 - Fuel card subject to income tax at the cost of whatever was spent on it (less the amount "made good" deduction towards private mileage)
 - Kept records of business mileage
 - Claimed through tax return for business mileage at the 45p / 25p rate.
I think that is the same as Jeremy says, just expressed differently. 

Yes (I actually expressed it both ways, either as a claim for £270 on my figures, or a claim for £450 but a BIK or salary of £180, depending on what the employer does).

This has to be the right way of doing it. The amount the employer expends on the fuelcard, less the recharge to salary, is simply a payment towards the mileage allowance of 45p/25p. If they just paid 12p a mile with no fuelcard or salary deduction, then you would claim 33p/13p. But this is not what they do, so you can't just pretend otherwise.

I understand what you are saying. But if HMRC advisory rate for company car drivers is 12p/mile as an accepted amount to cover fuel, surely they have to accept their own calculations for the use of fuel cards for fuel.
In the same way some employers deducted 12p/mile private rather than reimbursement for Business at the same rate.

MrMRJ

Thrugelmir said:

MrMRJ said:

Problem is I have no way of providing receipts to HMRC to show I have paid for my private mileage.

Are you maintaining a mileage log? 

Yes I am. Although thats just me, not company policy