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Where Taxpayers and Advisers Meet

Private Car and Company Fuel Card

TaxHelpNeeded
Posts:1
Joined:Tue Jun 15, 2021 3:31 pm
Private Car and Company Fuel Card

Postby TaxHelpNeeded » Tue Jun 15, 2021 3:52 pm

Hi All,
I'm hoping you can help. I started at a new company in October last year and for the first time ever I was given a company fuel card to use with my private vehicle. I was told that i could use this for both business and personal mileage but i would have to keep records, now what with lock down and customers not wanting to meet in person, plus my uncertainty about the tax, I've never actually used the fuel card. However I'm worried about the tax implications, looking at this calculator https://comcar.co.uk/fuel/benefit/ it seems to indicate that taxable benefit will be £3,640.80 based on 168g CO2 and 40% tax rate regardless of how many miles I've done or not done. Is this correct? Even if I've never used it, just the fact i have the card leaves me liable for the tax?

Many thanks in advance

Carl

darthblingbling
Posts:408
Joined:Wed Aug 02, 2017 9:09 pm

Re: Private Car and Company Fuel Card

Postby darthblingbling » Tue Jun 15, 2021 5:02 pm

The fuel benefit only exists if private fuel is given along with a company car. If you're given a fuel card for your private vehicle it's essentially a company credit card. Private expenses (i.e. your private fuel) is taxable and potentially subject Class 1 NIC if certain conditions aren't met. Ideally your employer should be reviewing this monthly.

Lambs
Posts:1558
Joined:Wed Aug 06, 2008 3:15 pm

Re: Private Car and Company Fuel Card

Postby Lambs » Tue Jun 15, 2021 7:06 pm

************THIS POST FROM LAMBS IS NOW OFFICIALLY RUBBISH BECAUSE LAMBS DIDN'T READ THE QUESTION PROPERLY****************

I am not sure it is quite that simple, because of how easy it is to trigger a fuel benefit charge.

By which I mean it could end up being that simple arithmetically, but there may be practical hurdles to consider.

My understanding is that the fuel benefit charge is invoked if [ANY] fuel is provided by reason of employment, alongside a company car that is subject to a BIK tax charge. It is then down to the employer/ee to demonstrate that there is no private fuel usage, so that it can be said that there is no private fuel provision - nil cash equivalent (ITEPA 2003 s 149 - 151).

The conditions under s 151 are:

The employer REQUIRES that the cost of providing private fuel is made good, and it is in fact made good (broadly, the employer demands to be reimbursed and is so reimbursed); OR

Fuel is made available ONLY for business travel.

I think that both (either) of these will need some kind of mechanism / agreement with the employer, practically speaking.

Note that it is down to the employer to decide if a fuel benefit arises, in the first instance, so my recommendation would be to ask the employer if they think a private fuel benefit is potentially chargeable and, if so, how to prevent it. If the company has a habit of handing out fuel cards to its employees then it should already have considered the fuel Benefit in Kind implications and have a policy on how to deal with the implicit provision of private fuel.

Regards,

Lambs
************THIS POST FROM LAMBS IS NOW OFFICIALLY RUBBISH BECAUSE LAMBS DIDN'T READ THE QUESTION PROPERLY****************

bd6759
Posts:3558
Joined:Sat Feb 01, 2014 3:26 pm

Re: Private Car and Company Fuel Card

Postby bd6759 » Tue Jun 15, 2021 10:12 pm

My understanding is that the fuel benefit charge is invoked if [ANY] fuel is provided by reason of employment, alongside a company car that is subject to a BIK tax charge.

Correct, but it’s not a company car.

Lambs
Posts:1558
Joined:Wed Aug 06, 2008 3:15 pm

Re: Private Car and Company Fuel Card

Postby Lambs » Wed Jun 16, 2021 12:32 am

Hmm. I have clearly misread the opening post, and the fact that the post is entitled "PRIVATE Car and company fuel card" does nothing to spare me any embarrassment.

My thanks to B and D, and apologies to the original querist. And again to D, who absolutely nailed it AND mentioned that it was a private vehicle. Again.

I could argue reasonable excuse on medical grounds but let's just say for now that I am wincing more out of embarrassment than a dodgy lamp.

Regards all,

Lambs


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