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Posted Wed, 28 Sep 2022 13:19:57 GMT by Den Green
Hi If an employee has a car allowance and fuel card and is going to repay his private mileage, is there a set amount per mile you have to charge them for their private mileage or is it at the company's discretion? Regards
Posted Wed, 05 Oct 2022 07:18:15 GMT by HMRC Admin 19

A fuel card for a private car, an employees own car, is very different to a fuel card for a company car.

As the employee does not have a company car but is using their own car you do not follow the rules for a company car with fuel. For income tax, the full cost of the fuel card over the whole year goes on to the P11D, section M. This is because the fuel card is regarded as a voucher and therefore is covered by different legislation. The employee can, however, claim Milage Allowance Relief, if they have business mileage records.

National Insurance contributions (NIC) legislation is different to tax in this instance. For NIC we would calculate the business mileage cost and subtract this from the credit card bill for fuel and the balance would be put through payroll for NIC. You can see information regarding confirmation of tax and NIC treatment when using a fuel card here:

NIM05819 - Class 1 NICs: Expenses and allowances: Motoring expenses (including mileage allowances) paid on or after 6 April 2002: Relevant motoring expenditure - payments using credit cards or fuel agency cards

If litany is used, the NIC due would be Class1A, on the full amount on the credit card. You can see guidance here:

NIM05663 - Class 1 NICs: expenses and allowances: fuel: liability for nics on fuel

Thank you.
Posted Wed, 05 Oct 2022 08:30:28 GMT by Den Green
Hi Is there any tax/ni liability if the employee reimburses his employers all of his private mileage. Regards
Posted Tue, 11 Oct 2022 15:11:59 GMT by HMRC Admin 19

There would be no tax or National Insurance liability for this.

Thank you.

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