Claiming mileage charge over 40p per mile

Stating running costs in pence per mile is not very accurate as it complete depends on how many miles that person is doing - (ie 1 mile a year 9p for running costs is ridiculous and at the other end of the spectrum 100,000 miles is £9000)

I average about 10p cost in petrol per mile. I am fortunate enough to own my own company and pay myself 40p per mile first 10K miles and 25p after. As I do 20,000/yr, this leaves

30p X 10000 = £3000
15p X 10000 = £1500

or £4500 per year

Road Tax £150
Tyres £50
Maintenance £250
Service £200
Insurance £250
TOTAL £900

So I actually make £3,600 a year!

My car only cost £7,000 (interest free for 3yrs) which I run over 3yrs.

So over 3yrs it more than pays for itself, plus a small profit and I then 'give' the car to my wife as she would not normally be able to afford a newish car.

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This is how I make it work

If you want
- A more expensive car
- Keep the car for longer
- Get paid less per mile

Then you have to do the figures yourself and see if it works for you. But everyone's situation is going to be different.

You can't expect the Goverment to account for everyone's situation and if your smart, you can easily make this work (quite substantially well)

Possetjohn wrote: »

Actually as stated in a subsequent post you don't 'get back' 40p per mile, but you are allowed to deduct business mileage at 40p per mile for the 10,000 miles and subsequent miles @ 25p per mile as a business expense. That means you 'get back' 40p x 20% = 8p per mile if you are a basic rate tax payer or 40p x 40% =16p per mile if you are a higher rate taxpayer.

If you calculate the current cost of running a car including all costs over 10,000 miles per year you will find 40p/mile barely covers costs for an ordinary car.

See this link for the AA calculation for a petrol car

http://www.theaa.com/allaboutcars/advice/advice_rcosts_petrol_table.jsp

Or Diesel

http://www.theaa.com/allaboutcars/advice/advice_rcosts_diesel_table.jsp

Of course if you are employed and your employer pays 40p per mile (if you are lucky!!) for business use of your own car the you get the whole 40p/mile tax free!!

Hi there. I have a question can anyone answer. I am a clinician that works for the nhs via a medical company. They pay me 40p a mile which I have been claiming for 2 years, which they pay me happily. Surely I dont drop down to 25p when i it 10,000? My company pays the full 40p, even over this figure. I'd guess I do between 14-15K a year

Doh wrote: »

this rate hasn't changed since about 2001 IIRC i'm sure everyone will agree the costs of motoring has risen considerably since then! its just another way of HMRC cashing in on the sly

An old post, but worth replying.

It probably is 2001 since the rates changed, but if IIRC they went DOWN then, partly because they were well over the odds in the first place , but also partly as a 'green' measure to (mildly) discourage use of vehicles for business use.

So the cost of motoring is only part of the picture.

John_Pierpoint wrote: »

Don't you get a tax free allowance of 20p a mile for riding a push bike?.

Only if someone is prepared to pay you.