motor expenses for ltd company help

need to make sense of it

Didn't find your answer?

i am part of a company that contains 3 directors, me being one

 

the turnover will be roughly 450k and therefore vat registered

 

here is what i need clearing up, we use our own cars for use in the business to go to places like the wholesalers and differnt suppliers to make orders, we would never go over the 10,000 miles a year

 

so i believe that we can claim 45p a mile back from the business, is this correct?

because i saw on another forum that we can not use this method because we are vat registered and instead would have to use the fuel method, is this correct?

and how do we process this in our bookkeeping, do we just make a note somewhere of the date/miles/and description/ and put it in the expenses folder? and do we have to do a p11d form? and do we ahve to do it through payroll/paye? or can we just do bank transfers from the business account once a month

 

 

thankyou

Replies (4)

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By Tim Vane
28th Jun 2017 07:45

Why not ask your accountant - it is what they are there for? If you have asked your accountant and they do not know the answer then you should find a new accountant.

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By johngroganjga
28th Jun 2017 07:46

Does your company not have an accountant?

Yes the company can pay you 45p per business mile without you paying any tax on it. The company being VAT registered or not is nothing to do with it.

Yes you should keep a record of the basis for the amount being reimbursed.

No you don't need to put the mileage payments on a P11D or through the payroll. The whole point is that payments at this level are outside the scope of tax.

You should check out - perhaps with your accountant - what VAT the company can claim on the reimbursements.

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RLI
By lionofludesch
28th Jun 2017 08:08

The fact that you have confused advice for sole traders with that for a company should be ringing alarm bells here.

Visit your accountant for advice before you drown in these deep waters.

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By DMGbus
28th Jun 2017 13:39

The 45p rate per mile is tax-free for upto 10,000 miles pa per director for recorded business miles in personally ownded cars run at the directoprs expense. Extra miles beyond this initial 10,000 pa are tax free at a lower rate, ie. 25p per mile.

These rates include fuel, and VAT can be reclaimed based on "Advisory Fuel Rates" which are published by HMRC [with changes usually every three months]:
https://www.gov.uk/government/publications/advisory-fuel-rates/advisory-...
Although headed up " These rates only apply to employees using a company car " in fact HMRC accept this scale for employee owned cars too.

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