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how do I work out business mileage for a company fuel card?

Discussion in 'Motoring Forum' started by richard plumb, Jul 9, 2008.

  1. richard plumb

    richard plumb Active Member

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    I have a fuel card which pays for all my petrol, and have a car allowance which funds my own private car.

    Now, last year I did no business mileage, so I got charged 40% tax on my petrol as a cash benefit. This year, I'm travelling to bristol approx once a week, a 200 mile round trip.

    Now, I understand that I can claim 40p per mile for these business miles, but how do I work out how many miles a year I need to do to cover my own personal miles? I.e where do I break even?

    lets assume a price per litre of £1.20, and my car averages 25mpg (usually about 26.5 but lets round it down). I do around 10000 miles per year personal miles.

    so my cost per mile is:
    25mpg / 4.546 litres per gallon = 5.5 miles per litre / £1.20 per litre = 21.p per mile?
    I get taxed at 40%, so I actually pay 12.6p per mile.
    10000 personal miles actually cost me £1260, so thats what I want to recoup

    this is where it gets tricky.
    a round trip to bristol is 200 miles (almost exactly). I can claim 40p per mile for that, which is £80. but the petrol for the trip would cost £40ish. so am I netting £40 per trip, or is it worked out differently? At £40 per trip it'd take 31 trips to break even, which means I should take the train more often :D

    I want to balance the car travelling so I don't use too many miles and affect my PCP with a nasty penalty at the end.
  2. Crocodile

    Crocodile Well-Known Member

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    Isn't your figure for 10,000 miles back to front? If you're paying 40% tax on the cost of the petrol then that would give a figure of 8.4p/mile. 10,000 personal miles would then cost £840.

    If you have a fuel card & a car allowance then I don't see how you can claim a mileage allowance as well. The mileage allowance is for business use of a privately owned & funded car. Your business mileage is being fully funded by your employer.
  3. Frostytouch

    Frostytouch Member

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    Is it your own business?

    If not, your trip to Bristol is costing you 40% of whatever fuel you buy on the card. (tax due to HMRC)

    You're saying it's 200 miles round trip, so you're getting 40ppm =£80 income and then deduct the 40% of the fuel cost.

    The 40 ppm is only for the first 10000 miles in a tax year, it's 25ppm thereafter.

    You mention 21.6ppm as your cost which seems OK, then you mention you pay 40% tax and come up with your net cost as 12.6ppm. Surely you mean it costs you 9ppm; as in 21.6ppm minus 12.6ppm?
    Last edited: Jul 9, 2008
  4. Frostytouch

    Frostytouch Member

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    If you have a fuel card & a car allowance then I don't see how you can claim a mileage allowance as well. The mileage allowance is for business use of a privately owned & funded car. Your business mileage is being fully funded by your employer.[/quote]

    I think he has a very generous employer, very rare to get the allowance, AMAP rates and a fuel card these days.

    His car is a private car so he can claim AMAP rates, the fuel card is a nice perk from his employer by the sounds of things and is perfectly allowable.
  5. richard plumb

    richard plumb Active Member

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    what are AMAP rates? Is there somethign that might stop me claiming my business miles back? I'm not claiming them as cash from the company, just using them to offset the cash benefit charge on a tax return.

    I see what you mean about numbers. *I* pay the tax, so I only pay the 40% part. Thats good :)

    so:

    lets assume a price per litre of £1.20, and my car averages 25mpg (usually about 26.5 but lets round it down). I do around 10000 miles per year personal miles.

    so my cost per mile is still 21.p per mile?
    I get taxed at 40%, so I actually pay 8.4p per mile.
    10000 personal miles actually cost me £840, so thats what I want to recoup


    a round trip to bristol is 200 miles (almost exactly). Costs me £16.8, but I can claim £80 so each trip is netting £63 ish. Which, to cover the £840 means 14 trips.

    that better?

    In which case I'd better stop now as I've already done that many this year. If you have more business miles than personal, can you actually claim a rebate, or is it only offsettable against fuel purchased? I.e once all my petrol is paid for can I claim proper money back? Realistically I'll probably do at least 30 trips, possibly double that, which is significant mileage and may take me over my PCP mileage so it'd be good if I could get some money out of it to offset that wear and tear/penalty charges from the PCP
  6. jayxbee

    jayxbee Member

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    As I understand it your employer is paying for ALL of your fuel?

    If that's the case then I think that the "fuel card" is a taxable beenfit. in other words it has a value, on which you pay tax (and NI). Say it's valued at £1,600 pa. you pay tax of 20% or 40% on £1,600 (£320 or £640) plus, I think 1% NI???

    The value depends on the car you drive and it's CO2 levels. Have a look at this site. http://www.comcar.co.uk/newcar/companycar/poolresults/gfuelben.cfm

    JB
  7. richard plumb

    richard plumb Active Member

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    on my P11D its listed under other items as 'fuel spend' and the full amount is listed as cash equivalent.
  8. Crocodile

    Crocodile Well-Known Member

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    I'm guessing that's because you say you had no business mileage last year.

    I don't think you would be subject to the fuel benefit scale charge (or whatever it's called these days) as referred to by Jayxbee as you don't have a car provided.

    I would have thought that the way it would work is that your employer would record all fuel spend as a monetary total. You would then need to track all business & private miles to come up with a percentage figure that could be applied to calculate tax on the actual benefit. Random figures to illustrate:

    10,000 Private miles
    5,000 Business miles
    15,000 Total miles.

    Using figures of 20MPG & £5 gallon (for ease) that would equate to a total fuel spend of £3,750.

    2/3 (66.67%) of that is private miles so benefit for tax would be £2,500. Tax on that at 40% would be £1,000.

    I don't believe that you can claim any business mileage as it's being fully funded by your employer. Having said all of that, I've been out of the loop on taxable benefits for a while so you really need to speak to an accountant
  9. jayxbee

    jayxbee Member

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    Good point. Hadn't thought of that. You're right. Gotta be worth talking to an accoutnant - or speaking to your HR dept. they may know the answer.

    JB
    Last edited: Jul 10, 2008

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