kenb@manx

Can anyone please explain how much tax I would have to pay on a company supplied petrol card for business and private use in my own car? If I were in the Uk of course

thanks

ken

Chris L

In my case, it was entered on to my P11D (I think!) benefits form from my employer. It was listed as effectively untaxed income. As a higher rate taxpayer, I have to pay 40% of this. However, you can offset your business mileage. Whatever you are left with, you pay 40% on. In my case, it means I will pay about £80 a month in extra tax. Not too bad when this equates to roughly filling up the Scoob twice - something I do every week!

I think you can also make voluntary contributions to your employer for your private mileage which is offset against the final amount.

Chris

AndyC_772

iTrader: (2)

Right. All spending on the fuel card is taxed just like any other income. You can claim tax relief on your business miles, but this is completely separate and has nothing to do with the card.

If you make voluntary contributions to your employer then this does reduce your tax liability - however, if you do this you'd be paying 100% of the cost of the fuel, rather than just the tax on it. It's not in your interests to do it unless your employer requires to you pay them back for any personal fuel.

A.

*Sonic*

ALL spending on a fuel card is not taxed

I have a Fuel Card, and the full amount is deducted from my salary each month, then I claim back my business miles, and then claim tax relief back on the business miles

You do pay tax on the fuel card, if the company pays for your private mileage also, mine dont, so no tax

AndyC_772

iTrader: (2)

Sonic,

If you're paying your employer back all the money you spend on the fuel card, then that's why you're not paying tax on it - your income is effectively reduced by the amount of benefit you get from the card.

When you claim expenses for business mileage, the Inland Revenue normally counts this money as taxable income as well. You can, however, claim tax relief for business miles at the Revenue's (NOT your employer's) mileage rate. If the two rates are the same, then you have no tax liability, so you get to keep your mileage expenses tax free. If your employer is more generous, you get taxed on the difference, while if your boss is tight, you do at least get a bit of tax relief.

Some employers have what's called a 'dispensation' - an arrangement with the Revenue that means you don't have to declare your mileage expenses on your tax return at all - it's all assumed to work out OK. Larger companies tend to have this arrangement, and it does make things a bit simpler.

In my case, the fuel card isn't just there for convenience of payment - it's an actual benefit, since I don't have to pay back what I spend on it. In that case, I really do mean that all spending on the card is taxed as though it were any other income. I can claim relief for business miles back on my tax return, but the relief I get (and the mechanism for getting it) has nothing to do with the fuel card itself.

All this stuff goes right out of the window if you have a company car - there are new rules coming in soon that relate the fuel card benefit to CO2 emissions, just like the car benefit already is.

Hope that clears things up a bit,
Andy.