What is the VAT fuel scale charge?

Definition of VAT fuel scale charge

A VAT fuel scale charge is a method of working out how much VAT to pay on fuel if you use a business car for private purposes.

Using the fuel scale charge means that you may be able to reclaim VAT on fuel used for business purposes without having to keep detailed mileage records. You cannot reclaim VAT on fuel used for private purposes, even if you used a company car to make the journey.

If you’re in any doubt about what you can reclaim or what records you need to keep, make sure to ask an accountant.

You can find out more about charging and reclaiming VAT in our dedicated guide.

How to use the VAT fuel scale charge

Step 1

Reclaim all of the VAT you paid on fuel for the car during a VAT period as input VAT when you fill in your VAT return. You can do this by putting the figure in box 4 of your VAT return.

Step 2

Work out how much VAT you owe for the period using the correct fuel scale charge. You can find VAT fuel scale charges for 1st May 2023 to 30th April 2024 on the government website, where you’ll also find a handy tool to help you calculate what you owe.

Whether you calculate the figure yourself or use the tool provided above, you’ll need to know your car’s CO2 emissions figure. This information is usually available in your vehicle log book, but you can also request it from the DVLA. For dual-fuel cars, use the lower of the two figures.

Step 3

On the same VAT return, include the VAT figure you calculated in step 2 in the total amount of output VAT that you owe. You can do this by putting the figure in box 1 of your VAT return.

Step 4

On the same VAT return, include the corresponding figure for the ‘VAT exclusive charge’. You can do this by finding the relevant figure in these tables on the government website and putting it in box 6 of your VAT return. The relevant figure will vary depending on the length of VAT period you’re filing for (monthly, quarterly or annual).

Using the VAT fuel scale charge in FreeAgent

If you’re a FreeAgent user and know the CO2 emissions figure for the car you’re claiming for, you may be able to apply the fuel scale charge to your VAT return in the software.

Check out our Knowledge Base for more information on how to apply the fuel scale charge in FreeAgent.

Disclaimer: The content included in this glossary is based on our understanding of tax law at the time of publication. It may be subject to change and may not be applicable to your circumstances, so should not be relied upon. You are responsible for complying with tax law and should seek independent advice if you require further information about the content included in this glossary. If you don't have an accountant, take a look at our directory to find a FreeAgent Practice Partner based in your local area.

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