This guidance note looks at the rules for recovering VAT on motoring expenses. In particular, it looks at VAT recovery on fuel and the charging of electric vehicles. It also considers VAT recovery for other motoring-related expenditure.
The recovery of VAT on the purchase or lease of a car or other vehicle is covered separately in the Input tax ― buying and leasing cars and other vehicles guidance note.
For an overview of input tax more broadly, see the Input tax ― overview guidance note.
For in-depth commentary on the legislation and case law in this area, see De Voil Indirect Tax Service V3.436 and V3.433.
VAT recovery on road fuel
VAT is generally recoverable on fuel which is used for taxable business purposes. However, there are intrinsic difficulties in proving road fuel is really used for business purposes. As a result, there are four broad options for a businesses which pays for road fuel:
- •
treat all of the VAT as input tax because 100% is used for business purposes (this will only be
Continue reading the full document
To gain access to additional expert tax guidance, workflow tools, generative tax AI, and tax research, register for a free trial of Tolley+™
Access this article for free with a 7 day trial of Tolley+™ Guidance and benefit from:
- Expert practical tax guidance
- Ready-made templates, step-by-step-guides, interactive flowcharts and checklists
- The latest news updates, insights and analysis
Popular Articles
Allowable expenses for property businesses
Allowable expenses for property businessesGeneral itemsMany of the principles applying to allowable expenses for property businesses are similar to those that apply for trading and the rules for individuals in a property business are generally the same as for companies with some exceptions which are
Tax Returns
Transfer of assets to beneficiaries ― legal, administration and tax issues
Transfer of assets to beneficiaries ― legal, administration and tax issuesThis guidance note outlines how assets are transferred to beneficiaries and the tax consequences that flow from the transfer. Whether a payment is income or capital is discussed in the Payments to trust beneficiaries guidance
Parking provision and expenses
Parking provision and expensesCar parking facilities at or near to the employee’s workplaceThere is an exemption from tax and NIC where an employer provides parking, or pays for or reimburses an employee for the costs associated with car parking at or near the place of work; there are no reporting
