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Categories explained: Vehicle Expenses πŸš™
Categories explained: Vehicle Expenses πŸš™
Steven Anderson avatar
Written by Steven Anderson
Updated over a week ago

This is where fuel and costs for maintaining the company car, van or truck will appear. Note, you can also allocate costs for maintaining your personal car only if the company is paying for these costs on your behalf and recording them as a benefit in kind.

What's included

  • Vehicle insurance and breakdown cover

  • Repairs and servicing

  • Fuel, mileage and parking

  • Hire charges

  • Vehicle licence fees

What's not included

Any expenses incurred when you are using the vehicle for personal travel.

How is it taxed?

The amount of tax relief you get will depend on how much CO2 your company cars use.

You can reclaim all the VAT on a new car if you use it only for business. It must not be available for personal use if you wish to reclaim all the VAT. For example it must be parked at work over night and cannot go home with the employee or director.

If you are paying for your employees car for private use through the company you'll need to report this to HMRC separately and at the end of the tax year ensure you report on form P11D and pay Class 1A National Insurance on the value of the car benefit.

Tax tips

Tax relief will depend directly on the CO2 emissions of your vehicle - as does benefit in kind reporting, so be sure to check the guidance and calculators provided at the below links.

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