Question on business mileage relief

heleen

My husband is employed and gets an annual car allowance on top of his salary (which gets taxed as income). This is not a company car through a company car scheme, which he could also have chosen.

I read that if you use your personal vehicle for business you and you get reimbursed less than 40p by your employer, you are able to claim business mileage relief.

In my mind this is our personal car and not a company car, and my husband just gets paid more cash. The company considers it a company car and that's why they only pay 25p. I think this is fair enough.

I would think therefore that we should be able to claim business mileage relief of 15p per mile (40-25). But I'm not so sure:

What is not clear to me is: is our car a company car for purposes of HMRC? Given that we have to pay all the maintenance etc and it is privately owned I would think not.

Any help appreciated
Heleen

Bean_Counter

heleen wrote: »

What is not clear to me is: is our car a company car for purposes of HMRC? Given that we have to pay all the maintenance etc and it is privately owned I would think not.

Any help appreciated
Heleen

From what you say your car is a personal car and not a company car.

I guess the reason that they are only paying 25p per mile is that this is intended to cover the fuel and other such running costs and that the annual car allowance payment you refer to would be considered as covering the capital.

You can claim tax relief on the difference between the 40p rate and the 25p paid for the first 10,000 miles.

soulsaver

And the diff between what the co paid and 25p for mileage over 10000 pa.

In your case that nothing 'cos you're getting 25p; but for the benefit of any others, if you were being paid 10p per mile for example, you could claim 15p pm relief for miles over 10k.