Fuel card, private mileage only?

That depends entirely on what you have agreed with your employer. Commuting only should cost you only some £15 a month I reckon.

Probably. The fuel money *and* the car allowance will be taxed the same as if the equivalent amount had been paid as part of your salary instead of as a

Yes, and more. Given that you are doing no business miles, all of the car allowance and all of the fuel money will count as income just as though you had been given it in your pay cheque.

That's daft. The benefit minus the tax on it will still be worth more to you than no benefit at all.

x-no-archive: yes

if not going to really use the car, ask for extra salary instead- just think of the planet!

Thanks for the response. Being in the 40% tax band, then my car allowance and fuel card are subject to 40% tax. The difference with the fuel card is that 40% is anywhere between 0 and £150 per month, depending on what the company allows me to use it for.

My main concerns are based on hearing of people who's company car benefits give them a lower tax code, and the benefit ended up costing them more than if they didn't have the car at all. I guess a fuel card is completely different. I just need to know all the facts before accepting this job.

Cheers

Boz

R>

Commuting is private mileage.

Yes

No, you will pay a flat rate which is the same even if you use only 1 ml of private fuel on the card. This depends on the type of car you have. The highest rate is tax on an additional income of £5,040.

There is an online calculator at

Don't think of it as having to pay between £0 and £60 tax per month. After all, for every £60 tax you pay, you will have received £90 of money to spend on £150 worth of fuel, i.e. you are getting a 60% subsidy on any fuel you buy.

Forget about the tax code. That's just a "first stab" method of trying to ensure you pay as correctly the right amount of tax as possible by PAYE rather than having to make big adjustments after you file your tax return.

All you really need to know is that all the car allowance and fuel allowance benefits will be taxed, so there is nothing to be gained by not getting it all as no-strings cash instead, which would give you greater flexibility in how you spend the money instead of having to spend it on a car and fuel.

Surely this is only the case where the employee is provided with a company car. In this case, however, that is not so. He is being offered a car allowance, i.e. an actual measurable amount of money towards the expense of running a non-company car, and an additional fuel allowance. Accordingly none of the flat rate schemes should apply, because the taxable benefit is not "a car", but money towards one, and not fuel, but money towards it.

as usual, RR is correct, indeed "on the money". The flat rate is only if you have a company car. If its your car, then you just get taxed on the pro-rated value of the fuel you use for private milage. (eg if 90% of the OPs mileage is private, he will pay 40% of 90% of whatever he spends on the card.). And his car allowance will get taxed as if its pay.

Steady on, now. I've been known to be wrong.

Would there not be an alternative option to treat *all* the card spending as taxable, but then to claim 40p per business mile of the income as non-taxable?

'Fuel Card' -> this is usually 'free' fuel. Car Allowance is an increase in salary deducted through PAYE.

I think the situation of Fuel Card without Co Car is not so clear from the tax point of view. Also, the fuel card is usually connected to a Co Car, or at least a specific registration (so you don't 'lend' it to the nearest HGV driver to fill up at a discounted price..)

The flat rate tax on the fuel card can be punitive if you only do low miles. Actually BIK tax on fuel card can be almost as much as the BIK tax on the car (ouch).

take salary uplift instead of fuel card then you can claim relief on fuel you buy for business miles because the IR does not care that the salary uplift is called 'fuel allowance', it is just salary.

I think the situation of Fuel Card without Co Car is not so clear from the tax point of view. Also, the fuel card is usually connected to a Co Car, or at least a specific registration (so you don't 'lend' it to the nearest HGV driver to fill up at a discounted price..)

The flat rate tax on the fuel card can be punitive if you only do low miles. Actually BIK tax on fuel card can be almost as much as the BIK tax on the car (ouch).

==================

flat rate is for company car only.otherwise it is clear cut, you pay tax at whatever rate you would pay it, if you had been given that money in your salary (minus the proportion used for business miles)

Thanks to all for their replies. Just a bit more info...

- I have no option for this card: I get it and I either use it or not.

- The company's recruitor (not an agency) told me that you can buy petrol on it for private miles (but was vague about how many vehicles).

I'm try to find out more. I'm just worried that I might be penalised in tax if I spend the full £150 per month on the card and the tax man takes exception to it and stings me for improper use or something.

And yes, the governments tax website is extremely unclear on Fuel Card's for situations where there is no company car and no business miles.

Boz

And yes, the governments tax website is extremely unclear on Fuel Card's for situations where there is no company car and no business miles. ============== its just the extreme case, eg 100% of the fuel spend is taxable.i have a colleague who does very few business miles and cant be bothered to claim a reduction,which as far as the taxman is concerned is the same as doing no business miles.

You pay tax on the cost of the fuel you obtain.

It's as simple as that. Don't worry.