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Sir, if the employee is paying for fuel for business purposes, then is it an allowable deduction or it dosent affect the tax benefit?
There is only a fuel benefit if the company is paying for any part of private mileage in a company car. Are you talking about someone using their own car for business purposes?
Yes. So if the employee is paying for fuel for business trips then would it be an allowable deduction?
Also will it make a difference in fuel benefit if the employee is provided with the car?
If the employee is using his own car for business then use the authorised mileage rates to determine any allowable deduction available to the employee as per OT notes if reimbursed at below the authorised rates. If the employee has the use of a company car then it would be usual for such costs to be paid for by the employer and if no private use is paid for the employee will avoid any assessable benefit
So what happens when a car is provided by the company to the employee and the fuel expenses for business trips is paid from the employees pocket?
Let me rephrase this.
When the company provides the car to the employee, a percentage is calculated and when the fuel is given by the company, then this percentage is multiplied to 21700 and the amount is taxable benefit.
The only way to avoid this is that the fuel is to be used for business use or pay for any fuel used for private use.
So if the employee pays for fuel used in business travel then will the fuel expenses be allowable deductions?
Thanks
If a taxpayer incurs an expense that is wholly, exclusively and necessarily incurred in the performance of the duties of employment then it is allowable
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