Rainham accountants, Trueman Brown, are a small firm of accountants who keep their clients up-to-date with the latest developments.

Most business claim mileage when a director/employee uses their own private vehicle for business purposes. However, most businesses (unless using the flat rate scheme) do not realise that they can claim Input VAT on the petrol element of the mileage allowance using the up to date advisory fuel rates. The latest advisory fuel rates from 1st September 2011 onwards can be found on the HMRC site.

The best way to show how to calculate the Input VAT is by giving an example.


A director/owner of a limited company drove 1,000 miles on business with his personal vehicle. The vehicle has an engine size of over 2000cc. Assuming that the advisory fuel rate for the vehicle is 21p per mile, the petrol element of the director’s mileage allowance claim is:
1000 miles @ 21p = £210 which is split
VAT Element is £210 x 1/6 = £35.00
Net Purchase is £175.00

To ensure that you make the claim for Input VAT, the business should keep the petrol receipts that cover the business mileage. They should be dated before the mileage claim is made and at least cover the cost of fuel for business journeys.

We will keep you up-to-date with an changes to the advisory fuel rates. There has been changes made in both June 2016 and September 2016.

Rainham accountants, Trueman Brown, can assist you in this matter. Please contact us on 01708 671910.