The research from expense management provider GlobalExpense was published in The Times on Friday. It shows that last year businesses lost £1.3 billion of the £9.9 billion paid in expenses to fraudulent and out-of-policy claims. Of this £9.9 billion, 35% was made up of business travel, making fuel a significant area to address.

Arval, which provides fuel cards to more than a million UK drivers, says that fuel cards are the best way to address this issue. This is because they allow the employer to accurately monitor driver fuel spend and reimburse them this exact amount; something that according to this national survey could save business millions of pounds.

Jenny Powley, sales director – Card at Arval comments, “When reimbursing employees for fuel expenses it is important to have controls in place to protect both the employer and the claimant. This survey demonstrates that without a fuel card policy in place, the temptation to exaggerate fuel expenses, or to make an honest error in submitting a claim, will remain.

“Historically, because fuel usage can be difficult for an employer to monitor it can provide an easy target for some business drivers. The best thing that businesses can do is to implement a fuel card policy which takes the uncertainty out of fuel claims.”

The research also shows that 41% of mileage claims were approved without a receipt, which means that businesses failed to recover £124 million in VAT in 2010. Fuel cards eradicate this problem because one consolidated invoice is produced, making it easy to recover 100% of business VAT on fuel purchases. This means that drivers are not required to collect and retain individual VAT receipts every time they make a purchase.

Powley adds, “Managing costs has never been more important and companies can’t afford to take a laissez-faire attitude. VAT is a prime example, where retrieving and collating large numbers of driver receipts provides a significant administrative task. Fuel cards totally remove this burden, delivering a single consolidated invoice which makes it easy for business to claim all of the business fuel VAT that they are entitled to.

“It is essential for any company to reimburse employees fairly but without overpaying expenses. With fuel making up a quarter of the cost of vehicle ownership it remains a crucial cost to control.”