Personal vehicle use for work - Mileage allowance

Careh

Hi,

Does anyone know much about mileage allowance when using your personal vehicle for work.

I have googled and checked direct.gov but can only find information stating the suggested rate of 40pence per mile.

I have recently driven a fair distance (1700) miles in my own personal vehicle and my employer states that they will reimburse me 20 pence per mile.

I thought, I read somewhere, that the minimum payment back was 22 pence per mile but I can find this again.

Can anyone shed any light on the situation?

Cheers.

Enfieldian

The employer can pay anything UP TO 40p per mile (for the first 10,000 miles, 25p there after) without you having to pay tax on it as a benefit.

You can also claim tax relief on the difference (18p per mile up to the 10,000) based on your tax band. Eg 40% x 18p = 7.2p per mile.

Careh

Argh, this may be a frustrating reply to Enfieldian. Appreciate the reply, can I clarify;

Enfieldian wrote: »

(for the first 10,000 miles, 25p there after) without you having to pay tax on it as a benefit.

Does that mean the minimum they can repay is 25p? Is this legislated somewhere that is publicly accessible as I would need to quote it to my employer?

If so;

Enfieldian wrote: »

You can also claim tax relief on the difference (18p per mile up to the 10,000) based on your tax band. Eg 40% x 18p = 7.2p per mile.

How do I go about claiming the extra back?

456789

no it means the maximum that they can pay after they have paid you for 10000 miles is 25p for further miles - their doesn't appear to be a minimum

juliescot

Would the simple solution be to stop using your own car for work purposes and get them to sort something out?

LeeSouthEast

If it helps with negotiation, I get paid 64p/mile for the first 10,000 miles, and 28p/mile thereafter. I've yet to get anywhere near the 10,000 mark though as it's fairly infrequent in my role (possibly ~500-800 a year).

KeithP

LeeSouthEast wrote: »

If it helps with negotiation, I get paid 64p/mile for the first 10,000 miles, and 28p/mile thereafter. I've yet to get anywhere near the 10,000 mark though as it's fairly infrequent in my role (possibly ~500-800 a year).

In that case I believe you should be paying income tax on 24p of that 64p.
As 40p is the maximum under HMRC guidelines that an employer can pay without it being deemed an employee benefit.

Pew_Pew_Pew_Lasers!

Annoyingly, those guidelines are years old, and entirely out of date compared with modern running costs.

dzug1

Careh wrote: »

Does that mean the minimum they can repay is 25p? Is this legislated somewhere that is publicly accessible as I would need to quote it to my employer?

No - they don't HAVE to pay you anything at all.

LeeSouthEast

KeithP wrote: »

In that case I believe you should be paying income tax on 24p of that 64p.
As 40p is the maximum under HMRC guidelines that an employer can pay without it being deemed an employee benefit.

Probably. My deductions each month could feed a small third-world country for a week. It also features on my P60 D11(iirc?) that suggests it is classed as a 'benefit'.

Premier_2

Careh wrote: »

...I have recently driven a fair distance (1700) miles in my own personal vehicle and my employer states that they will reimburse me 20 pence per mile. ....

Can anyone shed any light on the situation?

Cheers.

Submit an expense report to your employer at the agreed rate of 20p per mile

Did you have your employers prior approval to do the jouney in your own vehicle? Did you need prior approval? If so, you may find the expense claim denied.