Evidence of private use of company-provided fuel

The taxpayer employed travelling salesmen. They visited the business’s head office weekly but otherwise travelled between actual and potential customers. The taxpayer provided them – as well as some other employees - company cars which they were entitled to use also for private purposes. The company car users were allowed to fill up with fuel from a company fuel pump once a week but had to replace or pay for fuel for private use. None of the employees kept records of their private mileage.

After a compliance check HMRC decided the taxpayer should have treated the fuel as a taxable benefit. It raised assessments for class 1A National Insurance and imposed penalties. The taxpayer appealed.

The First-tier Tribunal said employers were obliged to ‘keep maintain and retain’ records in respect of employees making good or replacing fuel for private use. On the taxpayer’s contention that fuel was only for...