Increase in pump price adds £100,000 to cost of 500-car fleet, says TMC
In addition, the new VAT rate of 20% will raise such a fleet's fuel VAT bill from £122,000 to £136,000 in 2011, even if underlying fuel prices stay level, said Paul Jackson, managing director of the mileage and fuel cost management company.
'Unfortunately, oil prices are set to keep rising in the first half of the year. Petrol retailers are predicting that diesel will hit £1.40 per litre by April,' he said.
'Obviously, businesses need to recover every last drop of VAT on business fuel. The HMRC VAT scale charges are often not the most efficient method, while more potentially reclaimable VAT is often lost because drivers fail to retain receipts when they fill up.'
To help fleets maximise their VAT recovery on business fuel, TMC has published a free four-page guide covering all the options for reclaiming VAT.
The guide clearly explains the VAT recovery options available to fleets. It sets out the pros and cons of the two most widely-used methods of reclaiming VAT – using the HMRC scale charges or reclaiming the exact amount of VAT based on mileage records – with worked examples. It also explains how fleets can fully recover VAT without the need to submit forecourt till receipts.
Fleets can order a copy of the guide by calling 0843 222 6000.