Can My Limited Company Pay for My Petrol, MOT and Car Repairs?
If you are a company director and use your own car for work, it can be tempting to put your motoring costs through the business.
Petrol, tyres, servicing, repairs, MOTs and insurance may all feel like legitimate business expenses, particularly if you regularly use your car to visit clients, attend meetings or travel between sites.
However, there is an important distinction to make:
If the vehicle belongs to you personally rather than your limited company, the company should not simply pay all of its running costs as though it owns the vehicle.
Instead, where you use your own vehicle for qualifying business journeys, the usual way for your limited company to reimburse you is through a business mileage claim.
Personal Car or Company Car: Why Does It Matter?
A limited company is legally separate from its directors. This means there is a difference between a vehicle owned or provided by the company and a vehicle owned personally by a director.
If your limited company owns or leases a vehicle, different rules can apply to expenses such as fuel, insurance, servicing and repairs. There may also be tax implications where a company car or fuel is available for private use.
However, if you own the vehicle personally, it remains your vehicle, even if you use it regularly for work.
Rather than treating individual running costs such as petrol, tyres, MOTs and servicing as company vehicle expenses, HMRC allows employers to reimburse directors and employees for qualifying business mileage undertaken in their own vehicles.
What Should You Claim Instead?
If you use your own car or van for business journeys, your limited company can pay you an approved mileage allowance.
For the 2026/27 tax year, HMRC's approved mileage rates for cars and vans are:
- 55p per business mile for the first 10,000 business miles
- 25p per business mile after the first 10,000 miles
These rates apply where an employee or director uses their own vehicle for business journeys.
The mileage rate is designed to contribute towards the overall costs associated with using your personal vehicle, rather than simply covering the petrol you put in the tank.
This is why you should not normally claim the mileage allowance and then also put your petrol, tyres, servicing and other general running costs through the company for the same privately owned vehicle.
Got a company car? View the Advisory Fuel Rates for Company Cars | Blue Rocket
What Does a Mileage Claim Cover?
A common misunderstanding is that mileage claims are simply a way of reimbursing fuel.
They are not.
HMRC's mileage allowance provides a standard rate for using your own vehicle for business travel. This means you do not need to calculate the exact proportion of every tank of petrol, service, repair or other running cost that relates to your business journeys.
For example, imagine you use your personal car to travel 3,000 qualifying business miles during the 2026/27 tax year.
Your company could reimburse you:
3,000 miles × 55p = £1,650
Provided the payment falls within HMRC's approved amount, it can generally be paid without having to report it to HMRC as taxable earnings.
"But I Only Bought the Petrol for a Business Journey"
This is where we regularly see confusion.
You might fill your personal car with petrol before travelling to see a client and think:
"I only needed that fuel because I was travelling for work, so I'll pay for it on the company card."
However, HMRC has a specific mileage allowance system for employees and directors using their own vehicles for business travel.
For a privately owned vehicle, the cleaner approach is therefore to record the qualifying business journey and submit a mileage claim, rather than routinely paying the car's running expenses from the company bank account.
HMRC's separate Advisory Fuel Rates should not be confused with these mileage rates. Advisory Fuel Rates apply specifically to employees using company cars and HMRC states that they must not be used in other circumstances.
What Counts as Business Mileage?
Not every journey you make because of work will necessarily qualify.
Qualifying business travel can include journeys you need to make as part of your duties, such as travelling to meet a client or travelling to a temporary workplace.
Ordinary commuting between your home and a permanent workplace is generally considered private travel rather than business mileage.
This distinction is particularly important for directors, so it is worth checking whether a journey qualifies before including it in your mileage claim.
Keep a Mileage Log
If you regularly use your personal vehicle for business, get into the habit of recording your mileage as you go.
Your records should provide enough information to demonstrate the business purpose of the journey. Keeping details such as the date, where you travelled from and to, the reason for the journey and the number of business miles travelled can make your mileage claims much easier to substantiate.
It is far better to maintain accurate records throughout the year than try to reconstruct hundreds of journeys months later.
What If My Company Has Been Paying My Car Expenses?
If your limited company has been paying for petrol, tyres, MOTs, servicing or other expenses relating to a vehicle you own personally, don't assume those payments can simply be treated as company motoring expenses.
How they should be dealt with will depend on exactly what was paid, why it was paid and how it has been recorded in the company's accounts. There can also be tax, National Insurance, benefits or director's loan account implications depending on the circumstances.
It is therefore worth speaking to your accountant rather than continuing to put the expenses through the business.
Personal Vehicle? Think Mileage
The simplest distinction to remember is:
Company vehicle: the company may be able to meet the vehicle's relevant running costs, subject to the appropriate company car, private use and benefit rules.
Your personal vehicle: keep records of your qualifying business journeys and claim mileage from the company instead of treating the vehicle's general running costs as though they belong to the business.
For the 2026/27 tax year, that could mean claiming 55p per mile for the first 10,000 qualifying business miles in your own car or van.
Getting this right keeps the company's expenses clearer and helps avoid unexpected tax problems further down the line.
Not Sure If You're Claiming Your Motor Expenses Correctly?
At Blue Rocket Accounting, we regularly help limited company directors understand what they can legitimately claim through their business and how expenses should be recorded.
If your company has been paying for petrol, repairs, MOTs or other costs relating to your personal vehicle, or you're unsure whether you should be claiming mileage instead, speak to our team.
We can review how you're currently dealing with your motor expenses and help make sure you're following the correct approach.
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