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Vat on fuel

Vat charge to the sister company

our sister company used our driver to make their delivery. The company also used our fuel card. Now when I will raise an invoice for the fuel to sister company would I be charging vat on total amount which we have paid(inclusive of vat) or would I charge vat on amount (exclusive of vat) from the fuel receipt?


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13th Oct 2017 10:06

It depends on whether you want to charge on the fuel at cost.
If you take the net figure of the fuel, and add VAT, then that is at cost.
If you take the gross figure, and add VAT to that, you are simply making 20% profit on the re-charge.

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13th Oct 2017 10:28

If you pay the Fuel Card Company £60 for fuel, how much has it cost your company ? £50 because your company will recover £10 from the VATmen.

So you should charge your sister company £50 + VAT if you want to charge it on at cost.

Not obligatory though - you can charge what you like.

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