P87 - travel expenses

adonis10

Person A has to travel an extra 40 miles a day (8 days) to attend courses for his accountancy training. His employer refuses to reimburse the costs. Driving - petrol & parking would cost ~£150, train would cost £100.



As this is travel over and above his normal trip, has he any grounds to claim the costs back in any way? How would the 40p/mile thing work? And what about parking costs?

YORKSHIRELASS

So long as the travel is "wholly, necessarily and exclusively for business purposes" then he can claim tax relief at Inland Revenue business mileage rates. I would assume that if the training is organised by his employer and is required as part of his job then he can make a P87 claim at the end of the tax year. Travel from home to his regular place of work is not business mileage so he would need to deduct this. He would also need to keep mileage records and receipts for parking.

The rates are 40p per mile for the first 10000 miles and 25p thereafter.

adonis10

YORKSHIRELASS wrote: »

So long as the travel is "wholly, necessarily and exclusively for business purposes" then he can claim tax relief at Inland Revenue business mileage rates. I would assume that if the training is organised by his employer and is required as part of his job then he can make a P87 claim at the end of the tax year. Travel from home to his regular place of work is not business mileage so he would need to deduct this. He would also need to keep mileage records and receipts for parking.

The rates are 40p per mile for the first 10000 miles and 25p thereafter.

THanks.

Well, the training is an external course for the purpose of passing his exams. He will not be fired for not passing it but he is under a training contract with the intention of becoming fully qualified, and the course is obviously a route to doing that.

What about train expenses? Is that treated in the same way, ie. the actual expense, say £100, would be tax deductible?

Say it is, he will essentially only be able to recoup £20 (basic rate x expense)? This seems a little pointless.

Gertie_Walker

Any travel costs not using a car are alowable at their actual rate. £20 is better than nothing and represents the tax he would have saved had the employer refunded the travel costs and not taxed it.

adonis10

Gertie_Walker wrote: »

Any travel costs not using a car are alowable at their actual rate.

He'd be better off claiming for petrol then as the mileage would be a total of 280 * 40p/mile = £128 v £100 for the train costs.

What about parking? That would be additional because at work he has free parking, whereas this would be in a city centre, therefore likely to be £8-10/day.

Gertie_Walker wrote: »

£20 is better than nothing and represents the tax he would have saved had the employer refunded the travel costs and not taxed it.

He's still out of pocket though. If it costs him £100 and he claims it against tax, he gets £20. If his employer refunded it, he'd get £100.

Gertie_Walker

If he is an employeee, he cannot claim actual motoring costs, only the 40/25p method. Parking is not included in this.
If he would be better clainming from his empl,oyer, then thats an issue between him and the employer - tax relief is exactly what is says on the box - relief from tax, not a reimbursement of your expenses by the government.

adonis10

Gertie_Walker wrote: »

If he is an employeee, he cannot claim actual motoring costs, only the 40/25p method. Parking is not included in this.
If he would be better clainming from his empl,oyer, then thats an issue between him and the employer - tax relief is exactly what is says on the box - relief from tax, not a reimbursement of your expenses by the government.

Ok thanks. Was confused because he used to get repaid in full by his old employer, ie. drive 100 miles, they would paid £40.

New employer is very tight so the P87 method it is I guess. I assume it'll be dealt with at the end of the year? There won't be any more claims between now and next April, so can it be sent asap?

Gertie_Walker

He can claim whenever he wants.

bouncing_bubbles

Id say ask his employer for the policy they have that covers expences, also worth checking his contract and handbook. Employers should have a policy/protocol regarding payment of expences, if they dont check the ACAS website regarding this and then maybe discuss with employers.