You can use fuel scale charges to work out how much VAT to pay back on fuel if you use a business car for private purposes. This means you do not have to keep detailed mileage records.


How it works

  1. Reclaim all the VAT on fuel for your car.
  2. Use this HMRC tool to calculate the right fuel scale charge.
  3. Include this in the amount you owe on your VAT Return.


Before you start

  • You’ll need to check your car’s CO2 emissions figure if you cannot get this from your log book. For dual fuel cars, use the lower of the 2 figures.
  • For cars registered before 1997 that don’t have a CO2 emissions figure, the number you use depends on the engine size.


Preparation

Nominal codes - Before you can post your fuel scale charges, you must ensure that you have the relevant nominal codes:


Name
Management Report
Report Section
VAT Control (Default)
Balance Sheet
Current Liabilities
Scale Charges (Custom Account code)
Profit  & Loss
Expense


How to add a custom account code


To post the fuel scale charges

In this example the Vat  Return is quarterly starting on the 1 May 2018 for a car with C02 emissions of 160g/km

  1. Head to Tools > Journals > All Journals
  2. Enter the date, reference and any further relevant information for the fuel scale charge, for example:


Name
Details
Debit
Credit
Scale Charges
VAT fuel scale charge
£309

VAT Control
VAT on charge

£51.50
Scale Charges
VAT exclusive charge

£257.50


Ensure that both credit values have been checked to be included in VAT return as sales!