Question asked by Alan Bennett 7 years ago
Hi there,
I add up my business miles each quarter. Let's say I did 1000 miles. I create an expense invoice to claim back £450.
I am uncertain about if I should add VAT to this claim (I'm VAT registered). Should it be 20% or 0%
Thanks
Hi Alan,
When you are creating an expense, the tax is calculated according to what you spent. Once the expense has been approved, a bill is automatically created- you can see this by clicking into the approved expense and then the invoice number under the 'Linked expense claim' heading.
The bill is there for the purpose of the business reimbursing the whole sum to the employee claiming, therefore, there is no VAT added. It will then need to be paid off as a normal bill.
Thus, you need not do anything more than just this.
Best answerHi Aran,
Thanks for your answer!
So to sum up then I should leave the VAT as 0% ?
No problem, Alan!
The VAT rate should be the same as that which was paid when the expense item was purchased.
In your case, you would be creating a mileage receipt instead. The system uses HMRC guidelines on how much tax to charge, therefore it is automatically calculated - you do not have to type in 0%.
Thanks again
Hi Alan - am I missing something here, CB has a mileage claim feature in "Expenses" that you can use and it calculates the VAT reclaim automatically depending on the fuel and engine size (unless like me you run an EV!).
Ignore me - Aran's covered it in her screenshot!
You must 
