Commentary

V3.436 Road fuel—reimbursements and mileage allowances

Part V3 Supplies, acquisitions and imports

V3.436 Road fuel—reimbursements and mileage allowances

V3.436 Road fuel—reimbursements and mileage allowances

With effect from 1 January 2006, regulations1 made under VATA 1994 s 24(6)(a) provide for the recovery of input tax by a taxable person in respect of road fuel supplied to a taxable person (the employer) but delivered to, and paid for, by an employee who acts in the name and on behalf of the employer (the taxable person)2.

The amount of input tax is quantified by reference to the amount reimbursed to the employee3, ie—

  1.  

    (a)     where all of the fuel is used for the purposes of the taxable person's business, the actual cost of the fuel4;

  2.  

    (b)     where only part of the fuel is used for the purposes of the taxable person's business5

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