Claiming tax back on expenses?

sonic79_2

Hi all, don't know if anyone can advise me on this, but any help would be appreciated as I've been struggling with this for years.

I get paid travel expenses in my job, which is 32p per mile and travel time.

I was told in passing that I could claim some kind of tax back on this mileage allowance, but no one, not even my employer can / will take the time to explain this to me. Apparently there is a simple form to fill in and it can be back claimed for several years, and other people who have done it have got several hundred pounds back. That would be nice!

I got a letter last April from the company saying any mileage exceeding 4000 miles has been declared to HM Rev & Customs as they may consider it a taxable benefit. I did approx 16,200 miles in the tax year 2008/09

Any advice on how to follow this up, what its called, what form I need, do I need an accountant to help me?

Thanks in advance.

fengirl_2

The form you need is P87, but you can also make a claim in a letter. You can claim tax relief on the difference between what your employer pays and 40p pm for the first 10,000 miles and 25p pm thereafter. You can claim for up to 6 years back and you dont need an accountant

sonic79_2

Thanks Fengirl, take it I can find a form online somewhere. Will have a surf.

Rolo_Tomasi

Just be careful that you don't end up paying tax. The rates are as stated above but you appear to be paid 32p per mile for all travel whereas the tax free rate is only 25p per mile for anything over 10,000 miles. By my calculations if you ever do more than 21,000 miles in a year you will end up owing tax.

pwally2

Sorry for hijaking this thread but cani ask would I be right in assuming the 40p per mile is only if you are using your own car not a company car.

Rolo_Tomasi

Yes - The Revenue rates of 40p and 25p are for using your own car for business travel. There are fuel only rates if you have a company car but pay for all fuel yourself. These are dependent on the engine size and fuel the care uses.

sonic79_2

Rolo_Tomasi wrote: »

Just be careful that you don't end up paying tax. The rates are as stated above but you appear to be paid 32p per mile for all travel whereas the tax free rate is only 25p per mile for anything over 10,000 miles. By my calculations if you ever do more than 21,000 miles in a year you will end up owing tax.

Thanks Rolo, I'll try to keep my mileage down / not put a claim in if I go over 21,000!

lisyloo

Off topic, but if you are using your own car for company business then please make sure you upgrade your insurance.
Insurance for commuting covers you for ONE permanent place of work, so it does not cover you for travelling to customers or even going on a course.
The cost for upgrading can be nothing or can be quite small, but you must make sure you are adequately insured.

Apologies for going off topic, but lots of people seem not to realise that social, domestic & pleasure with commuting, does not cover them for using their car on business journeys or even occasioanl travel to a different office or course.

Generally employers regard that the 40p per mile covers all your additional costs, so generally they don't pay for this as they take the view it's included in your allowance.
They should tell you about this but ultiamtely it's the drivers reposnsibility to make sure theya re insured.

sonic79_2

Yep, you're quite right lisyloo, my employer has to see my insurance cert to make sure all is ok.