car millage allowance

jofusmofus

Hi guys,
I work as a mobile employee and travel to different sites across the north. I use my own car and can be travelling anywhere between 15,000 and 25,000 miles per year. My employer pays me 32p per mile for anything over 30 miles per day.
Could anyone help me with how much, if any I could also claim from HMRC and how to go about it.
Thanks

TM1976

If you are truely mobile and you have no permanent workplace all of this mileage is business mileage even the 30 miles the employer has not reimbursed you.

HMRC AMAP rates are 40p for the first 10,000 miles and 25p thereafter so it's possible you will be in a profit situation and have to pay tax however this depends on the mix and distance of journeys you are doing.

You need to find out what your employer has paid you in mileage reimbursement in each tax year.

You need to work out the business mileage you have done in the tax year INCLUDING the 30 miles that your employer has not paid you for.

If you are in a profit situation you need to declare this otherwise you can claim using a P87.

jofusmofus

OK great. Well by April 6th 2010 in the financial year I will only have done 10000 miles (as I started the job part way through the year). I will have been paid by my employer for 7500 if those therefore leaving me 2500 unpaid miles as well as only being paid 32p per mile for those miles I am paid by the employer for.
So am I right in thinking I should receive tax relief on 2500 miles at 20%? And ontop of this would I receive anything on the difference of 8p per mile on the other 7500 miles?
Thanks for all your help

TM1976

Yes, but obviously it gets more complicated once you get over 10,000 miles at 32p because then it starts working the other way for you.

00ec25

using your figures and assuming you have records to show they were genuine business miles then

2500 miles, employer pays £0.00, you can claim back 8 pence per mile = £200 (ie 40p x 20% = 8p x 2500)

7500 miles, employer pays 32p, HMRC would allow 40 p, differecne is 8 p, you can claim back 1.6 p per mile = £120 (ie 40 - 32 = 8 x 20% = 1.6p x 7500)

so for 10,000 miles you can claim £320
BUT every mile you drive over 10,000 you will have to pay HMRC 1.4p per mile in tax (ie 32 - 25 = 7 x20% = 1.4p)

therefore you would have to drive another 22,857 miles on top of your inital 10,000 each year before you would lose all that £320 in the extra tax you would have to pay (£320/£0.014 = 22,857)

jofusmofus

OK thanks for all the help everyone. That all makes sense now.