Misc Motor Expenses, Congestion Charges, Mileage & Scale Charges: Codes 7304, 7305, 7306 & 7350

Beyond the core running costs of fuel, servicing, tax and insurance, motoring throws up a few other regular items — city charges, employee mileage claims, and a VAT quirk specific to businesses that provide fuel for private use.

The codes, and what each one holds

Code 7304 — Miscellaneous Motor Expenses is a catch-all for smaller motoring costs that don't fit the main vehicle codes, such as car parking or valeting.

Code 7305 — Congestion Charges records London Congestion Charge, ULEZ, or similar city driving charges.

Code 7306 — Mileage Claims records reimbursements to employees who use their own vehicle for business travel, typically at the HMRC-approved mileage rate.

Code 7350 — Scale Charges records the VAT fuel scale charge — a fixed addition to the VAT return that accounts for private fuel use where a business reclaims VAT on all fuel bought, including for personal journeys. All four are Overheads codes and normally carry a debit balance.

A worked example

Say an employee drives 200 business miles this month in their own car, claiming 45p a mile, and separately the business incurs a £15 ULEZ charge and the quarterly VAT fuel scale charge of £68 applies to its pool car.

Mileage Claims (code 7306): £90 debited (200 × 45p).

Congestion Charges (code 7305): £15 debited.

Scale Charges (code 7350): £68 debited, alongside a corresponding output VAT adjustment on the VAT return.

Why this matters day to day

Mileage claims are worth watching closely since they're one of the most common areas HMRC scrutinises — the reimbursement rate and business/private mileage split both need to be right. The fuel scale charge, meanwhile, is easy to forget entirely if a business reclaims VAT on all fuel; getting it wrong on the VAT return is a common and avoidable compliance slip.