VAT on mileage for using business car

Rasa Settling In NicelyRegistered Posts: 22

I was tying to find any info how much VAT we can claim on mileage using business car? Our director was using business car (leased) for personal and business trips, and he claims mileage for business trips in June 2010 at 11p per mile (advisory fuel rates from 1 June 2010 for diesel). So how can I work out VAT?

Many thanks.


  • Monsoon
    Monsoon Font Of All Knowledge FMAAT, AAT Licensed Accountant Posts: 4,071
    In a normal scenario where someone uses their own car for business and are claiming 40p/25p a mile:

    If the advisory fuel rate for that period and for that size/ type of car was 11p then the calcs are:

    29p per mile - expense, no VAT
    11p per mile inclusive of VAT
    Total 40p per mile, of which 11p is inclusive of VAT (so like 1.63p or whatever)

    If it gets to 10k miles then its
    14p no vat
    11p inc vat
    total 25p per mile

    I'm not sure how it works in other situations where its not being claimed at 40p/25p but I think the principle of the vat on the 11p is the same. I never come across the situation enough to know the answer off the top of my head.
  • Rasa
    Rasa Settling In Nicely Registered Posts: 22
    Thanks Monsoon!

    And we have decided that what director claims for mileage for his business trips using company car is inclusive of VAT at 17.5%. Because you can claim VAT only on fuel element, and he claims only 11p per mile (advisory fuel rates from 1 June 2010 for diesel). So it means this 11p is only for fuel element.
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