Motoring expenses

Produced by Tolley
Motoring expenses

The following Value Added Tax guidance note Produced by Tolley provides comprehensive and up to date tax information covering:

  • Motoring expenses
  • Repairs and maintenance costs
  • Car parking
  • Road fuel
  • Applying the VAT fuel scale charge
  • Charge for the private use
  • Paying mileage allowances
  • Fuel VAT receipts
  • Insurance claims

IP COMPLETION DAY: 11pm (GMT) on 31 December 2020 marked the end of the Brexit transition / implementation period entered into following the UK’s withdrawal from the EU. At this point in time, key transitional arrangements came to an end and significant changes began to take effect across the UK’s VAT and customs regime. This document contains guidance on subjects potentially impacted by these changes. Before continuing your research, see the Brexit — overview guidance note.

This guidance note provides an overview of when VAT can be recovered on motoring expenses. This note should be read in conjunction with the following guidance notes:

  1. Buying and selling a car

  2. Leasing a car


Repairs and maintenance costs

A business can reclaim VAT incurred on repair and maintenance costs providing the following conditions are satisfied:

  1. the car is used for business purposes

  2. the business pays for the work to be done

  3. if the car is driven by a sole proprietor or partner, then the car cannot be used solely for private purposes

VIT54500; Notice 700/64; De Voil Indirect Tax Service V7.449, V7.447

Please note that a business c

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