Centurion VAT offer some insights into the changes to VAT on fuel for business use.

The VAT road fuel scale charges have been amended with effect from 1 May 2022. Businesses must use the new scales and they will apply to VAT periods starting on or after that date. Access the updated VAT Fuel Scale Charges here. 

There’s still no news from HMRC on the review they were undertaking into VAT recovery on Electric Vehicle recharging by employees at their home addresses for cars used for business purposes – currently they see that as a supply of electricity to the employee not to the business which seems at odds to the treatment of petrol that an employee buys for which a VAT deduction can apply through the Mileage Rate calculation.

As businesses develop their Net Zero strategy to reduce their carbon footprint, the interaction with VAT and Environmental Taxes such as the Climate Change Levy, should not be ignored especially if that strategy includes own energy generation or in the construction sector looks at the re use of materials, such as aggregates on major projects. The new Plastic Packaging Tax is having a wider impact than many businesses envisaged for example.

Perhaps an Indirect Tax strategy chat with our specialist team would be of value. You can get in touch at emailus@centurionvat.com to start that conversation.

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