Business milage

[LeeHayler]

Hi folks.

Last august i became a sole trader. Before that i was a director of a company, and before that a sole trader. I use my van for business and leisure. I have a fuel card which automatically debits my business account. Previously when i was a sole trader and a different van, my accountant put my business milage through the books which gave me tax relief. My current accountant has suggested i use receipts i get from my fuel card supplier and i log my personal milage. So my milage since becoming a sole trader was 7900 which gives me a relief of around £3400. Using the receipts just doesn't seen to benefit me.

Any thoughts?

 

[numbersrule]

You say ' I use my van for business and leisure '.

So the van is owned by you personally and registered in your own name?

If that is correct, then you should be doing exactly what both your accountants have suggested which is to claim the £0.45 per mile mileage allowance for using your private vehicle for business mileage.

Please explain your fuel card. If that is a business fuel card it sounds to me like you are using it to pay for fuel used for business purposes via your business account. You shouldn't be buying fuel via the business account whilst at the same time claiming the £0.45 per mile.

When you say you get 'relief', I think what you mean is the £0.45 per mile is an allowable business expense.

Regarding Receipts, you are supposed to keep receipts as evidence that you do actually buy fuel, when you are claiming the £0.45 per mile.

Using receipts from your fuel card sounds incorrect to me. It sounds like you are having your cake and eating it too.

 

[DWS]

As always with things like this it is best to run the figures and then choose which method is best.
The mileage allowance also covers other vehicle expenses like repairs, maintenance, tax and insurance etc etc and more importantly the cost of the vehicle so actual costs may work out better.

 

[MyAccountantOnline]

Hi folks.

Last august i became a sole trader. Before that i was a director of a company, and before that a sole trader. I use my van for business and leisure. I have a fuel card which automatically debits my business account. Previously when i was a sole trader and a different van, my accountant put my business milage through the books which gave me tax relief. My current accountant has suggested i use receipts i get from my fuel card supplier and i log my personal milage. So my milage since becoming a sole trader was 7900 which gives me a relief of around £3400. Using the receipts just doesn't seen to benefit me.

Any thoughts?

Ask your accountant why they suggested using actual costs. They will have all of the relevant figures and should quickly and easily be able to clarify why they've suggested that to you.