The VAT fuel scale charge lets a VAT-registered business reclaim all the VAT on fuel for a car that is also used privately, then pay back a fixed amount instead of measuring private miles. Whether it suits you depends on how much of the car's mileage is for business. Below is a simple comparison of the three options, using the same car and fuel bill, so you can see where the break-even point sits.
Key takeaways
- You have three choices: reclaim all fuel VAT and pay the scale charge, reclaim only the business share, or reclaim none.
- The scale charge depends on the car's CO2 emissions and your VAT return period, not on actual private miles.
- The higher your business mileage, the more the mileage-records route tends to win, if your records are good.
- The VAT scale charge is separate from the income tax car fuel benefit charge.
What is the fuel scale charge?
When a business pays for road fuel and some of it is used for private journeys, that private use is treated as a supply for VAT. HMRC's VAT Input Tax manual (VIT55400) sets out the options. One of them is the fuel scale charge: a set, VAT-inclusive figure for each CO2 band. At the standard rate of 20%, the VAT you pay back is one-sixth of that figure. The current amounts are in HMRC's road fuel scale charges table on GOV.UK. Check the current figure for your car there, because the table changes every year.
The three options compared
| Option | What you reclaim | What you pay back | Records needed | Tends to suit |
|---|---|---|---|---|
| A. Scale charge | All VAT on fuel | VAT within the scale charge for the car's CO2 band | Fuel receipts and the car's CO2 figure | Higher fuel spend with modest business mileage records |
| B. Business share only | VAT on the business proportion of fuel | Nothing | A full mileage log showing business and private trips | Mostly business mileage, kept in a reliable log |
| C. Reclaim nothing | No VAT on any road fuel | Nothing | None for fuel VAT | Low fuel spend where the other routes save little |
HMRC notes that choosing option C means not reclaiming VAT on any road fuel, including fuel for commercial vehicles, so think about your vans before choosing it.
Illustrative example: one company car, two mileage patterns
Illustrative example: the company, the car and every figure here are invented. The scale charge used is an assumed figure for the sums, not HMRC's actual rate. Look up the real figure in the GOV.UK table.
Brightside Interiors Ltd is VAT-registered and provides a company car to its director. The company pays for all the fuel: £3,600 a year including VAT, so the VAT on fuel is £600. Assume, purely for illustration, that the annual scale charge for the car's CO2 band is £1,800, so the VAT to pay back is £300.
| Net VAT recovered in the year | 70% business mileage | 40% business mileage |
|---|---|---|
| A. Scale charge (£600 reclaimed − £300 paid back) | £300 | £300 |
| B. Business share only | £420 | £240 |
| C. Reclaim nothing | £0 | £0 |
In this example, the break-even point is 50% business mileage: above it, option B recovers more; below it, option A does. That only holds with these invented numbers. With a real scale charge and a real fuel bill, the crossover moves, so rerun the sums with your own figures. Also remember the director side: if the company pays for private fuel in a company car, there is normally a separate benefit in kind to report for income tax, which is often the larger cost.
How to choose: a five-step check
- List the vehicles. Separate cars from vans, and note who uses each one privately.
- Find each car's CO2 figure. It is on the registration document. Look up the matching scale charge for your VAT period on GOV.UK.
- Total a year of fuel spend. Your bookkeeping or fuel card statements give the VAT figure.
- Estimate business mileage honestly. If you cannot back the estimate with a mileage log, option B is risky.
- Compare the three results and record the choice. Apply it consistently on each VAT return and review it when a car or usage changes.
Common mistakes
- Reclaiming all fuel VAT and forgetting the charge. That over-claims input tax on every return. See what VAT you can reclaim.
- Using last year's table. The figures change each year, so check the right one for your period.
- Using the annual figure on a quarterly return. There are separate figures for each return period length.
- Applying the car scale charge to a van. Vans follow different rules.
- Thinking only about VAT. The income tax cost of private fuel often matters more. Our guide to company car vs own car covers the bigger decision.
How we can help
We review fuel VAT as part of every return and run the comparison for each car when your circumstances change. VAT returns start from £120/quarter on a fixed fee. See our VAT returns service, check our pricing, or contact us with your vehicle list.
Frequently Asked Questions
What is the VAT fuel scale charge in simple terms?
It is a fixed amount of output VAT a business pays back when it reclaims all the VAT on fuel for a car that is also used privately. Instead of measuring private mileage, you look up a figure based on the car's CO2 emissions and your VAT return period, and account for the VAT contained in it.
Where do I find the current scale charge figures?
HMRC publishes them on GOV.UK in its road fuel scale charges table, with separate figures for annual, quarterly and monthly VAT periods. The figures are updated each year and apply from the start of your first VAT period beginning on or after 1 May. Always use the table for the period you are filing.
Does the fuel scale charge apply to vans?
HMRC's guidance describes the scale charge as applying to cars, such as company cars and taxis used privately. Vans are dealt with differently. If a van is used privately and you pay for its fuel, speak to your accountant about the correct treatment rather than applying the car scale charge.
Can I just claim the business share of VAT instead?
Yes, if you keep detailed records of business and private mileage. HMRC's manual says you can reclaim VAT on the business proportion of fuel only, and then no scale charge applies. Without good records, it is hard to show HMRC that private motoring is not funded by the business.
Is the fuel scale charge the same as the car fuel benefit charge?
No. The scale charge is a VAT adjustment made by the business. The car fuel benefit charge is an income tax charge on an employee or director whose employer provides fuel for private journeys in a company car. One does not replace the other, so check both before agreeing to pay private fuel.
Related reading
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Schedule a consultation →Written by the Berber Accounts & Tax team, 124 City Road, London EC1V 2NX, United Kingdom.
Last reviewed: 2 November 2026.
This article is general information, not personal tax advice. Speak to a qualified accountant about your own circumstances before acting on it.