TT115: VAT Fuel Scale Update

April 23, 2008

In Topical Tips 103 we reported on a change to VAT fuel scale charges effective 1 May 2007. This linked the VAT charge for businesses that recover VAT on fuel used for private motoring to the CO2 emissions of each car.

For VAT periods starting on or after 1 May 2008 a new set of scale charges must now be applied. Changes include;

  • CO2 banding now as low as 120 g/km (previously the lowest band was 140 g/km)
  • A general increase in VAT scale charges (no surprise there!)

New Rates per vehicle

Twelve month period Three month period One month period
CO2 band g/km Scale Charge VAT due Scale charge VAT due Scale charge VAT due
£ £ £ £ £ £
less than or equal to 120 555.00 82.66 138.00 20.55 46.00 6.85
125 830.00 123.62 207.00 30.83 69.00 10.28
130 830.00 123.62 207.00 30.83 69.00 10.28
135 830.00 123.62 207.00 30.83 69.00 10.28
140 885.00 131.81 221.00 32.91 73.00 10.87
145 940.00 140.00 234.00 34.85 78.00 11.62
150 995.00 148.19 248.00 36.94 82.00 12.24
155 1050.00 156.38 262.00 39.02 87.00 12.96
160 1105.00 164.57 276.00 41.11 92.00 13.70
165 1160.00 172.77 290.00 43.19 96.00 14.30
170 1215.00 180.96 303.00 45.13 101.00 15.04
175 1270.00 189.15 317.00 47.21 105.00 15.65
180 1325.00 197.34 331.00 49.30 110.00 16.38
185 1380.00 205.53 345.00 51.38 115.00 17.13
190 1435.00 213.72 359.00 53.47 119.00 17.72
195 1490.00 221.91 373.00 55.55 124.00 18.47
200 1545.00 230.11 386.00 57.49 128.00 19.06
205 1605.00 239.04 400.00 59.57 133.00 19.81
210 1660.00 247.23 414.00 61.66 138.00 20.55
215 1715.00 255.43 428.00 63.74 142.00 21.15
220 1770.00 263.62 442.00 65.83 147.00 21.89
225 1825.00 271.81 455.00 67.77 151.00 22.49
230 1880.00 280.00 269.00 69.85 156.00 23.23
greater than or equal to 235 1935.00 288.19 483.00 71.94 161.00 23.98

Identify the band

For vehicles registered after 2001, the CO2 emissions figure appears on the Vehicle Registration Certificate (VC5). For vehicles registered between 1997 and 2001 the information can be obtained from The Society of Motor Manufacturers and Traders Limited website. In addition, the Vehicle Certification Agency Car Fuel Data website can be used to search for specific cars. Further historical information is available at The Vehicle Certification Agency.

For vehicles that do not have a CO2 emissions figure, the CO2 band is based on engine cylinder capacity.

  • 1,400cc or less; use CO2 band 140
  • Exceeds 1,400cc but does not exceed 2,000cc; use CO2 band 175
  • Exceeds 2,000cc; use CO2 band 240 or above

Note that the bands above have not changed despite the new lower bands in the scale charged.

Barnes Roffe Topical Tips:

  • Ensure that you adopt the new VAT fuel scale charge as soon as is applicable – this is usually the first thing a VAT Inspector will check during a VAT inspection.
  • For any vehicles that have no private use (e.g. a pool car) it is essential that there is evidence to support this contention.
  • If a car is changed during a tax period and the new car is in a different category, then the VAT should be accounted for by apportioning the scale charges for the two categories. Alternatively, to keep it simple, the higher of the scales can be used.
  • If an incorrect rate has inadvertently been used, then a correction should be made on the next VAT return. However, if the cumulative error comes to more that £2,000 of VAT then a special declaration to HMRC must be made
  • If it is wished to claim the VAT on all business fuel paid for by an employee and reclaimed from the company, then the company must have specific evidence of the VAT incurred by the employee – see Topical Tips 77
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