I am preparing my first quarterly VAT return and wish to reclaim the VAT from my employee expenses mileage payments. For example, let's say I have done 1000 miles and current HMRC rates state VAT can be reclaimed from the 13p/mile fuel element, i.e. 0.13 x 1000 x 0.2 = £26.
I can't find an easy way to enter this as an expense or cost, the only thing I can see is to manually adjust the return by the amount calculated. If the latter is acceptable to HMRC then fine, no worries but if there's a correct way that someone could point out that would be appreciated.
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@glennc - did you get anywhere with this? As far as I can tell, the only 'correct' way to do this is to enter 2x expense lines as :-
1. Mileage rate (non-fuel portion)
2. Mileage rate (fuel portion)
And then apply vat at 20% to '2.' and no vat to '1.'
The article here seems to explain : https://www.millwardmay.co.uk/quickbooks-vat-on-mileage
Unless it's possible to alter the vat rate on expenses, do you know? Quickbooks doesn't seem to have an inbuilt solution to this, does it?
Thanks for joining this thread, @Domalos
I appreciate sharing to us the alternative steps on how to reclaim the VAT for mileage. This information will surely help other users in the same situation.
QuickBooks doesn’t have a built-in feature to automatically adjust the tax at this time. Another way to do this is to override the amount on the expense.
Let me guide you on how to perform these steps.
This should get you pointed in the right direction. Keep me posted how these steps work for you. I’ll jump right back in to help.
To be fair I didn't investigate any further. When I submit my mileage expenses for the month, I just split it into 2 lines, VAT recoverable and not. I've got two expense types set up in Travel & Accomodation and then I just allocate the appropriate amount to each type, see file attachment.
Shame it's not simpler but it's hardly a bind. I was advised to comment the mileage and amount in each transaction just for traceability. BTW the HMRC allowances change periodically, you can find the current allowances here: