Epenses-Fuel & other

System
System Posts: 100,534 🤖 Admin 🤖
edited June 18 in AAT member discussion
Im sure this is a silly question and I know the answer but ive reached the stage where my brain is puddled.Im doing my first set of accounts as an MIP for 05/06. The accounts are for a self employed joiner in his first year of trading and half of his fuel receipts are just debit card/Switch receipts.Dont they have to be VAT receipts? even though he's not VAT registered. Someone please confirm!!

Comments

  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Epenses-Fuel & other

    No they don't have to be VAT receipts. They are for proof of input tax.

    Regards

    Dean
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Epenses-Fuel & other

    I agree, but switch or debit card receipts do not say what is purchased - this could include other items purchased at the garage. I would always suggest that a VAT receipt is requested.
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Epenses-Fuel & other

    Just to confirm that it is good practice to recomend to clients VAT receipts. Debit and credit card reciepts are ok, but It has cropped up in Revenue Enquiries regarding sundry items at garages especially when the Revenue finds out the client smokes.

    Therefore recommend VAT receipts.

    By the way I assume you have also worked through the FPCS rules. If the client is not vat registered this option may be beneficial !

    Robin Stride FMAAT Membership No 412
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Epenses-Fuel & other

    Me too - fine if it is £10 worth - but an "odd" amount could be fuel plus a packet of fags....

    Claudia
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Epenses-Fuel & other

    Thank you Robin,
    I have to confess that I havn't heard of FPCS before, not even at the HMRC course which I attended recently. I have just researched it though on the HMRC website and dont really understand it,please could you explain. Im not sure it would be appropriate for my client though,he is a self employed joiner with a van?
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Epenses-Fuel & other

    Firstly give the Revenue a ring (stationery dept) and ask for a copy of the Self Assessment Tax Return Guide for HM Revenue & Customs Staff and Tax Practitioners tax return guide. Its a free publication and has 500+ pages on all aspects of the tax return. This has all the information needed on all aspects including FPCS rules.

    Come back to me if you cant find where to get the guide.

    I shall reply later on (meeting just started) regarding your FPCS rules question, and yes it does apply.

    Robin Stride FMAAT Membership No 412
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Epenses-Fuel & other

    Thank you again, I will definately be getting those publications.I thaught I recognised your name and just discovered that I rec'd an e-mail from you recently about the very meeting which you're at tonight.Im just up the road from you at Bedale.
    I hope you dont mind if I contact you in the future with any queries which I may have. This will be my first self assessment and so i'm a little worried!! :D
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Epenses-Fuel & other

    Email direct to you, but for those interested click on the

    [url] http://www.hmrc.gov.uk/pdfs/2000_01/self_employment/IR222.pdf[/url]

    link above and that takes you to one of the booklets included in the Revenue handbook... Form IR222.

    This explains the basics of using FPCS rules within the self employed business. (by the way the page is out of date on the revenue website e.g. VAT turnover limits etc etc

    Obviously before you all go out and swap look into the rules and make sure that you understand them fully.
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Epenses-Fuel & other

    Hello Everyone,
    I complete my partners tax return and i was told by the Inland Rev office that fuel can only be claimed if he is going to a supplier then onto his place of work as going direct to his place of work is classed as private fuel/mileage (i think this is common knowledge anyway). I understand that this is how employed peoples fuel is treated so is it the same for self-employed?

    My partner is a builder so his place of work is anywhere and everywhere.
    So obviously i have not been taking all of his fuel expenses against his income, so looking at Jacqui's question what is the correct way to treat fuel receipts, claim or no claim?
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Epenses-Fuel & other

    You cannot claim fuel to/from your "fixed" place of work - ie office.

    If you are a joiner then you will be going to different sites - ie a transient worker, so you CAN claim the cost - either 40p/mile as Robin talked about (remember the 10,000 mile threshold) or actual receipts and the private element of motoring added back.

    A sub-contractors "office" will invariably be their home - ie where they write out their invoices, do their bookkeeping ( :lol: ) etc etc.

    Claudia
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Epenses-Fuel & other

    Thanks Claudia

    So i dont suppose there is anything i can do about the fuel receipts that i excluded from last years tax return? Obviously i took some out because the IR said i couldnt claim them.
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Epenses-Fuel & other

    Beaten me to it ! Yes as Claudia has said... mileage can be claimed.

    What we recomend to all our clients:-

    1. Record car mileage reading at year end dates (I normally remind in letter requesting books that goes out a week before hand !)

    2. Keep a small A5 hardback book (maybe where seatbelt is plugged into) and record private mileage only e.g. Pub/Chinese/Asda etc etc

    So at the end of the year I have (a) the total mileage and (b) the total private mileage

    So either (a) claim FPCS rules or (b) put total costs of running vehicle in box 3.55 with the relevant private mileage % (b divided by a) in box 3.37

    We recomend that private mileage is recorded not business as this tends to be minimal, and you try asking a typical 'tradesman' to record mileage in his van !

    Robin Stride
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Epenses-Fuel & other

    Hi Robin,
    Thanks for your advice, i will definately mention this to my partner for next years return. So seeing as i only have fuel recipts for this year and not a mileage log as you have suggested, can i claim all of the fuel even though my partner has not always been to a suppliers first? (adding back private fuel of course)
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Epenses-Fuel & other
    KLOU wrote:
    Hi Robin,
    Thanks for your advice, i will definately mention this to my partner for next years return. So seeing as i only have fuel recipts for this year and not a mileage log as you have suggested, can i claim all of the fuel even though my partner has not always been to a suppliers first? (adding back private fuel of course)

    Pop the full costs in box 3.55 and use your best calculated guestimate for the % of private use.

    Instead of just guessing mileage:-

    Try digging out MOT or service invoices as these should give dates around the start and year end dates, and based upon these you should be able to nearly accuratly find the mileage for the year, then sit down and try to re-create private mileage based upon 'normal private useage'.

    e.g. year end 31/03/06

    MOT 31/01/06 35,000 miles
    Service 30/04/06 38,000 miles

    So mileage at year end 31/03/06 was approx 37,000 miles !

    You never know with a big of digging and research you might even be able to reconstruct the mileage records.

    A little bit of time and bingo a fairly accurate return... no fear of penalties !
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Epenses-Fuel & other

    Now I feel really silly!!! of course ive heard of claiming mileage as opposed to actual expenses but I havn't heard it called FPCS before this threw me a bit dur!!!!!!

Categories

Privacy Policy