Company Fuel Card - Tax in laymans terms please
#1
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Hi I wondered if the minds of SN could help answer a quesion
I have done many searches of google etc but still cant find a definitive answer as every thread goes on about business mileage so in short here is my situation
I have a Co fuel card - unlimited spend (pure benefit in kind)
I run a privately owned car - Volvo 2.0D V50
I do no or very very little business mileage ( no more than 2000 a year)
I will spend roughly £3700-£4000 diesel in the next 12 month period
Covering roughly 24000 miles commuting and social
Already paying 40% tax on income.
The Big Question is
What will be the tax implications be for me based on my situation above, 40% in the £1 to be in line with my income tax ?
The outcome may determine whether I re enter the Subaru fold![Smile](https://www.scoobynet.com/images/smilies/smile.gif)
Thanks for any advice offered
I have done many searches of google etc but still cant find a definitive answer as every thread goes on about business mileage so in short here is my situation
I have a Co fuel card - unlimited spend (pure benefit in kind)
I run a privately owned car - Volvo 2.0D V50
I do no or very very little business mileage ( no more than 2000 a year)
I will spend roughly £3700-£4000 diesel in the next 12 month period
Covering roughly 24000 miles commuting and social
Already paying 40% tax on income.
The Big Question is
What will be the tax implications be for me based on my situation above, 40% in the £1 to be in line with my income tax ?
The outcome may determine whether I re enter the Subaru fold
![Smile](https://www.scoobynet.com/images/smilies/smile.gif)
Thanks for any advice offered
#2
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Your tax code will be hit by the cost of the fuel - say £3700 - so your tax code will reduce from eg 650L to 280L. This will have the effect of you paying 40% tax on the £3700 = £1480. Hence your net income will reduce by £125 a month or thereabouts.
Normally, if you did business mileage, you would be able to claim business miles back to off-set this. However, you don't do any - so you can't claim any back.
My fuel costs for my (privately owned) Lexus are MUCH more than yours, but I do a lot of business miles (I work in sales) and the business miles that I claim back usually more than offset the cost of the fuel - so I have a slight net gain.
Anyway, that's how I think it'll work for you!
DN
Normally, if you did business mileage, you would be able to claim business miles back to off-set this. However, you don't do any - so you can't claim any back.
My fuel costs for my (privately owned) Lexus are MUCH more than yours, but I do a lot of business miles (I work in sales) and the business miles that I claim back usually more than offset the cost of the fuel - so I have a slight net gain.
Anyway, that's how I think it'll work for you!
DN
#3
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Thanks Dr No
That's exactly how I thought it would be, just wanted to be sure before going back to a Petrol car, I was thionking of the Leggy 3.0R B-spec, but it drinks fuel, probably not a good move right now, sadly...
Cheers
That's exactly how I thought it would be, just wanted to be sure before going back to a Petrol car, I was thionking of the Leggy 3.0R B-spec, but it drinks fuel, probably not a good move right now, sadly...
Cheers
#4
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I have the same - own car but a company fuel card (petrol). It's taxed as a cash value on my P11D. The taxable value has always in the past been lower than the actual fuel I purchased (I do save all receipts and check at the end of the year). So in effect I pay less for my fuel with the company fuel card than if I purchased out of my wallet.
I don't think it would matter if I drove a diesel or petrol, it would still be taxed against it's cash value. You may need to check if there are bands where the tax is higher though I spent 3.5k - 4.5k on fuel per year.
Probably this is a small loop hole HMRC haven't spotted yet and will be plugged one day.
I don't think it would matter if I drove a diesel or petrol, it would still be taxed against it's cash value. You may need to check if there are bands where the tax is higher though I spent 3.5k - 4.5k on fuel per year.
Probably this is a small loop hole HMRC haven't spotted yet and will be plugged one day.
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#6
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Just done the Maths, currently I spend roughly £300 a month on diesel, based on the 40% tax I'll be £180 a month better off which is very useful when all around us prices are rising.
If I went for the Spec B I'd spend roughly £525 a month being taxed £210 leaving me £90 a month better off which would no doubt be gobbled up with servicing.
Sadly I have to be sensible, Dammit![Mad](https://www.scoobynet.com/images/smilies/mad.gif)
I should have stayed in Oz where the WRX and fuel card were tax free benefits
If I went for the Spec B I'd spend roughly £525 a month being taxed £210 leaving me £90 a month better off which would no doubt be gobbled up with servicing.
Sadly I have to be sensible, Dammit
![Mad](https://www.scoobynet.com/images/smilies/mad.gif)
I should have stayed in Oz where the WRX and fuel card were tax free benefits
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