VAT FUEL SCALE CHARGES REDUCED!


We are so accustomed to rising motor taxes that it was a nice surprise to see the VAT fuel scale charges (in respect of petrol and diesel supplied for private motoring) decrease for return periods. This reduction is to commence on or after 1 May 2014 and follows the recent reductions in the price of petrol and diesel.

The new quarterly charges range from £156 a quarter (inclusive of £26 output tax) for a car emitting 120g per km or less to £548 (£91.33 output VAT) for cars emitting 225g/km CO2.

Remember that unless the director / employee fully reimburses the employer for private fuel, the appropriate amount for the company car should be shown as output tax for the return period. A credit entry made to motor expenses should be made in the business accounts.

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Filed under Accountancy & Tax Stuff, Business advice

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