How do fuel cards work?
Updated 15 Dec 2020
Fuel cards are a super convenient way for businesses to manage and track their business fleet expenses.
Fuel cards work similarly to credit cards. They’re linked to an account and when you buy fuel, or other approved services and items, you pay with your fuel card.
The cost of the purchase will then be taken from your linked account, whether it be a credit card or bank account.
The beauty of fuel cards is that each purchase is recorded individually on its own tax statement. This means you can say goodbye to hoarding receipts or sifting through bank statements because the records are already conveniently kept separate for you.
What are the benefits of a fuel card?
From a business standpoint, fuel cards greatly reduce the amount of admin time spent consolidating fuel expenses.
Everything is already done for you by the fuel cards, so when tax time comes around, you’ll enjoy a much simpler process.
The benefit of this is especially realised when you have multiple drivers and multiple cars.
Many fuel cards offer exclusive discounts and savings when purchasing select products.
These can include a cents per litre discount on fuel, discounted access to services and repairs and discounted purchases at petrol station convenience stores.
Because you’re able to leave receipts behind (and not risk losing them), fuel cards also make sure that you’re able to easily claim every cent and dollar at tax time, which means more money back into your business.
You can also look for a fuel card provider that lets you pay for your account via credit card, which means you don’t miss out on any credit card rewards, but you still have control over purchases.
Some fuel cards allow online access to your account. This makes it really convenient to manage, track, report and consolidate your fleet fuel expenses.
You can set up certain purchasing rules, such as value limits and excluded/approved items, and you can be alerted when these rules are broken.
There are fuel card providers who have a very high level of security attached to their cards.
This includes at least requiring pin code verification and having anti-fraud technology.
The difference this has over using company credit cards is that if it is lost or stolen, the card can only be used to purchase select goods and services.
Who is a fuel card suitable for?
A fuel card is suitable for any type of business that has vehicles. Whether you’re self-employed, a small family-owned business or a large corporation, fuel cards can benefit your business massively.
Whether you’re simply looking save time consolidating expenses at tax time, or trying to manage dozens of vehicles in a company fleet, fuel cards can help.
Remember, all fuel cards are a little different from each other, so putting in the time and effort to choose the best one for you and your business's needs will pay off.
On weekdays Rowan can be found in the AutoGuru office, driving content and growth with the rest of the marketing team.
On weekends you’ll probably find him in the garage with his dad restoring a 1958 Ford Star Model Customline or enjoying a cruise through the Gold Coast hinterland on his Suzuki GSX-R600.
Despite his passion for being behind the wheel (or handlebars), he looks forward to the day when he can commute to work in his own driverless car.