Self assessment - Company fuel card
Discussion
Gave back a company car last August and took the allowance to sort myself out a car, also managed to score a fuel card for it. Have now received my P11d and looking to do my first self assessment.
My understanding is that I would be liable for 40% of the fuel cost in tax (as a higher rate tax payer), less 40% of 45p per mile business mileage - is this correct?
To use my example, I have spent £1500 on fuel between Aug-Apr, and covered 2000 business miles. By my calculation;
tax on P11d fuel - 0.4 * 1500 = £600
Tax 'rebate' for business mileage - 0.4 * 0.45 * 2000 = £360
Leaves me owing £240 tax, assuming my understanding is correct.
Now since this is my first self assessment, I'm not sure when is best to do it - does it matter? I'm aware of the deadlines obviously. Following the self assessment, do I need to pay the owed tax immediately, or will my tax code be adjusted - if the latter is it current year or following year that gets adjusted? For such a small amount it's largely irrelevant, but I like to know where I stand, and may owe much more if my understanding of the liability calculation is wrong!
My understanding is that I would be liable for 40% of the fuel cost in tax (as a higher rate tax payer), less 40% of 45p per mile business mileage - is this correct?
To use my example, I have spent £1500 on fuel between Aug-Apr, and covered 2000 business miles. By my calculation;
tax on P11d fuel - 0.4 * 1500 = £600
Tax 'rebate' for business mileage - 0.4 * 0.45 * 2000 = £360
Leaves me owing £240 tax, assuming my understanding is correct.
Now since this is my first self assessment, I'm not sure when is best to do it - does it matter? I'm aware of the deadlines obviously. Following the self assessment, do I need to pay the owed tax immediately, or will my tax code be adjusted - if the latter is it current year or following year that gets adjusted? For such a small amount it's largely irrelevant, but I like to know where I stand, and may owe much more if my understanding of the liability calculation is wrong!
Is there a tax Benefit in Kind in respect of company fuel showing on the 2015/16 you received from your employer? If there is, this is the figure that should be entered on the 2015/16 Self Assessment tax return.
So, in reality, you shouldn't have to do any calculating yourself. The figure you need should already have been calculated by your employer and entered on the P11D.
If it turns out that you do have a tax liability arising because of the fuel card, HMRC has two alternatives regarding how they collect it. They can ask you to pay the extra tax directly under the Self Assessment system OR they can collect the 2015/16 extra tax by adjusting your 2016/17 PAYE tax coding. Indeed, HMRC gives you a choice when completing the tax return to tick a box indicating that you would prefer to have the tax collected through a PAYE Coding adjustment rather than by direct payment. It's up to you.
Indeed, HMRC may already have adjusted the 2016/17 PAYE coding based on teh information provided to them by your employer under the P11D. I would check your current 2016/17 PAYE Coding to see if it has already been amended to take any Benefits in Kind into account.
Finally, if you chose to pay the extra tax directly under Self Assessment, the due date for paying 2015/16 tax amounts is 31 January 2017.
So, in reality, you shouldn't have to do any calculating yourself. The figure you need should already have been calculated by your employer and entered on the P11D.
If it turns out that you do have a tax liability arising because of the fuel card, HMRC has two alternatives regarding how they collect it. They can ask you to pay the extra tax directly under the Self Assessment system OR they can collect the 2015/16 extra tax by adjusting your 2016/17 PAYE tax coding. Indeed, HMRC gives you a choice when completing the tax return to tick a box indicating that you would prefer to have the tax collected through a PAYE Coding adjustment rather than by direct payment. It's up to you.
Indeed, HMRC may already have adjusted the 2016/17 PAYE coding based on teh information provided to them by your employer under the P11D. I would check your current 2016/17 PAYE Coding to see if it has already been amended to take any Benefits in Kind into account.
Finally, if you chose to pay the extra tax directly under Self Assessment, the due date for paying 2015/16 tax amounts is 31 January 2017.
There is a set of boxes in the "Employment Pages" to enable you to make a tax claim for expenses incurred in the course of your employment. That is where you would make any mileage claims.
If you are completing the form on-line, the necessary boxes will be included in the "Employment Income and Expenses" section.
You can only make a mileage claim on the return if the mileage amount you are receiving from your employer is less than 45p up to 10,000 business miles and less than 25p for over 10,000 miles.
Mileage claims are in respect of the TOTAL cost of using your car for business related travel. It is not just "fuel" related.
If you are completing the form on-line, the necessary boxes will be included in the "Employment Income and Expenses" section.
You can only make a mileage claim on the return if the mileage amount you are receiving from your employer is less than 45p up to 10,000 business miles and less than 25p for over 10,000 miles.
Mileage claims are in respect of the TOTAL cost of using your car for business related travel. It is not just "fuel" related.
For the sake of clarity, when I say ''I deduct', I of course mean it gets deducted automatically after the numbers are inserted into the correct form fields. I'm just trying to see if my understanding is correct so I can calculate my own tax position prior to submission. I've know hmrc to be wrong before, so I prefer to know facts so I can challenge where appropriate.
Ive had a fuel card and allowance for 17 years now, and just done my SA tax return for the year
As per Eric, you put the P11D value of the fuel in the "other benefits" section
In the "other business expenses" you put your business miles
.45p for the first 10K miles and .25p thereafter. Say you did 15K business miles thats £4500 + £1250 so you put £5750 in "other expenses" and in the notes section you put your working out as above, reg of your car if you like.
So you get taxed on the cash benefit of the fuel and you get relief on business miles
If there is a refund due no doubt you may get a new coding notice through and your allowance put up. However this puts you in a position of where you feel like you need to drive as many business miles each year, otherwise you owe the tax man money. I usually ring up HMRC when I get the coding notice and put my code back down a bit as it was. I prefer to look forward to a few hundred quid "bonus" each year. It helps motivate me to do the return
As per Eric, you put the P11D value of the fuel in the "other benefits" section
In the "other business expenses" you put your business miles
.45p for the first 10K miles and .25p thereafter. Say you did 15K business miles thats £4500 + £1250 so you put £5750 in "other expenses" and in the notes section you put your working out as above, reg of your car if you like.
So you get taxed on the cash benefit of the fuel and you get relief on business miles
If there is a refund due no doubt you may get a new coding notice through and your allowance put up. However this puts you in a position of where you feel like you need to drive as many business miles each year, otherwise you owe the tax man money. I usually ring up HMRC when I get the coding notice and put my code back down a bit as it was. I prefer to look forward to a few hundred quid "bonus" each year. It helps motivate me to do the return
Eric Mc said:
I always prefer to get tax refunds properly "refunded" rather than have HMRC mess about with tax codes.
Same here, try to keep the tax code the same, and always tick the box saying "pay into my bank account" ASAP and usually its there within a week ...one of the few .gov online services thats very efficient 
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