Excess Mileage refund - taxable?

nickyjay21

Hiya,
not sure if this is the right forum to post this in but i hope someone can help - i have been transferred from my previous employer to a local authority on the TUPE transfer, and have found in my contract from the previous employer that i am entitled to claim for excess milage from my old place of work to the new place of work for a period of 2 years.

I have now recevied my first refund payment but noticed i have been taxed on it - is this right as i believed that it would be the same as expenses that are not taxed - i.e. i have already incurred the cost and am being reimbursed therefore no tax.

Am i right or should i be taxed on these payments?

Many thanks

Nickyjay21

Anihilator

I would say they are right. It doesnt meet the HMRC definition of business mileage hence is not a reimbursement but in fact a benefit in kind.

fengirl_2

Travel to and from work is not tax deductable and therefore any payments made to you for this purpose are liable to income tax.

KME91

You are being paid to commute, this is a benefit, so is therefore taxable, as far as HMRC is concerned. It will also be subject to NI contributions.

jdturk

I would guess that because you are travelling to your regular work place that it is tax deductable because its seen as part of your contract under tupe (they are paying you a taxable sum for the extra distance travelled), people who get 40p per mile un taxed is due to journeys that are outside their normal journey to work.

its a guess though!