When Purchase VAT is claimed on business fuel used for private purposes, a VAT scale charge may apply. It is used to repay the purchase VAT to HM Customs and Excise. The charge varies according to the emissions of the vehicle. Please contact your local Customs and Excise office to confirm the appropriate scale charge or refer to the Current Scale Charge leaflet issued annually by HM Customs and Excise.
1. You will need a nominal code in Miscellaneous Receipts Group for “VAT Fuel Scale Charge" In our example this has the code 630.
You will also need your nominal code for fuel in the Overheads Group. In our example this is 1200.
2.Choose Journal Nominal from the Entries menu.
3.Enter the Nett scale charge and Output VAT against the VAT Fuel Scale Charge nominal(630).
4.Enter the VAT element against the Fuel nominal (1200). Enter this as a POSITIVE.
5.Enter the nett amount of the scale charge against the VAT Fuel Scale Charge nominal (630). Enter this figure as a NEGATIVE.
5.The final SAVE screen should look like this:-
This transaction can now be set up as a Standing Order to simplify Data Entry.