For those who use business vehicles privately and reclaim the VAT back on all road fuel, it is important that the appropriate Fuel Scale Charge is applied. The Fuel Scale Charge ensures a standardised VAT add back and is based on the CO2 emissions of the vehicle. Applying a Fuel Scale Charge makes things simpler, as you don’t need to maintain detailed mileage logs.
From the 1st May 2017 the Fuel Scale Charges changed and the new rates can be found here
These new rates should be applied to VAT returns commencing on or after the 1st May 2017.
The fuel scale charge is entered on your monthly/quarterly/annual VAT return as follows:
- Box 1 – VAT element
- Box 6 – net element
Depending on your mileage it may not be worth reclaiming the VAT back on fuel, as the Fuel Scale Charge may exceed the VAT you wish to reclaim.
Drummond Laurie can help with your VAT returns, as well as your other accounts and tax matters. For more information, please contact Margaret Bunyan on 01324 441266 or margaret.bunyan@drummondlaurie.co.uk