Van running costs

jilbo Registered Posts: 197 Dedicated contributor 🦉
Hi there,

I have just taken on a new sole trader, he is a mobile mechanic and I have literally just been given paperwork for his 07 and 08 tax returns!

My query is he has a second hand van which is soley for business purposes, however I noticed apart from a few invoices for parts there are no running costs. When I asked him about this he said he had been very unorganised and hadn't saved fuel receipts, but says he has now started to do so. I asked about motor insurance and he said that he pays a policy which covers everything, motor, liabilty etc for about £900pa.

He can't claim mileage 'cos the cost of the van's been put through his books so it's not a private vehicle. I suppose we could estimate fuel consumption based on the jobs he has done but wouldn't that just prompt an investigation, especially as he already has penalties and interest outstanding for his 07 return.

He seems such an honest guy and it's a shame he should lose out on allowable expenditure for a year and a half but I suppose it will enure he is more organised from now on.

Any comments or confirmation of my thoughts would be much appreciated.


  • groundy
    groundy Registered Posts: 495 Dedicated contributor 🦉
    When we have a client missing fuel receipts we normally allow an estimate from the client or claim 12p per mile as the fuel element.

    There is no need to think this would prompt an investigation as it would be unreasonable for HMRC to not accept that your client incurs fuel costs.
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