Left short-changed by business mileag rates

bootman

I have just read this short piece in Auto Express dated 23-29th July. It says

I was pleased to see that company drivers can claim back the difference if the business mileage rates leave them out of pocket.

I get 14p per mil from my employer which is in line with HMRC guidelines for 2008. But my VW passat costs more to run than this. So every trip leaves me out of pocket. Can you tell me what forms I have to fill in?

The reply from the TAX man say

''Employees need to keep records of the amount of fuel bought, mileage driven and reimbursements made from the employer, and then fill in a SA return to claim expenses at the end of the year''

myrnahaz

I think you've answered your own question - you need a Self Assessment form. Check online to make sure that's the only form you need.
If you register with HMR&C, you can complete and submit your SA return online (by 31 January), which is much easier than attempting the paper version (which has to be submitted by 31 October).

BoGoF

You don't actaully need to complete a Tax Return, a letter showin how much you are claiming and how you have arrived at this figure (which may be the sticking point) is all that is required.

MonkeySaving?

The only form you need to complete is the P87 -> http://www.hmrc.gov.uk/forms/p87.pdf

Send it back, don't send any mileage logs and wait and see if you get asked for them. You'll either get a cheque for the tax relief or they'll adjust your tax code accordingly.

bootman

P87 is if it's you car, I read the article for company cars not private cars and mileage, People are being short changed as they are only able to claim back say 14p but the fuel itself is costing them a lot more for business usage.

BoGoF

Don't waste your time trying to complete a P87 if it's a company car. All you will get back is a letter saying why are you trying to claim 40p a mile for a company car, it relates to private vehicles only.

jimmo

I haven’t read the Auto Express article you referred to but the principle that if your business motoring expenses are more than what your employer pays you then you can claim tax relief on the difference is correct.
A P87 definitely does not fit the bill for you and you need to formulate your own claim.
For 2007/08 you will have to state:
Your total business mileage
Your total private mileage
The total you paid out. As you have a company car that really should be fuel only.
You then have to apportion the amount you paid out between business mileage and private mileage.
Then compare your business mileage costs with the amount your employer paid you.
If you have sufficient records to enable you to do that then go ahead with your claim.
On the other hand, if you cannot actually put in a claim which you can justify then don’t waste your time trying at this time.
Make a real effort from today onwards to accurately record all these details and keep all receipts for fuel. (Incidentally, it’s a relatively common problem that till receipts and pay at pump receipts tend to fade fairly quickly. The best solution seems to be to photocopy them.)
Once you have real evidence in place to show that your business journeys are costing you money it will be much easier to establish an actual claim and then look back at earlier years.
If you try to make a claim now for 2007/08 along the lines of my car does 20mpg then you are going to be shot down in flames for lack of evidence. If you can prove that in 2008/09 your costs are £xxx and you used the same car for 2007/08 then the taxman really should be quite happy to negotiate an allowance for 2007/08 based on your 2008/09 results.
Just a couple of other thoughts.
In my days as a taxman a couple of my colleagues had VW Passats as company cars. They were both diesels and both drivers were content that they were making money out of their mileage allowances.
If yours is a petrol engine then I have no difficulty in seeing that it is costing you money but you’ve still got to prove it.