Car allowance and claiming business milage - a Strange one!!!

Myron_Bolitar

Hi Guys,

I need a bit of advice on car allowance etc for my new job.

I am just started working for a dutch company (as the sole UK employee) They are paying me £5000 a year car allowance (to use my own car - which I have had to buy) but are stating that I cannot claim for milage at the government stipulated rate, but instead just put all company fuel on my company credit card.

Is this viable/legal from a taxation point of view? I mean, how can you even calculate how much fuel is used for business and how much is used for private.

If I cannot claim back at the normal 40p per mile for first 10,000 miles and 25p thereafter, I think I am going to be out of pocket, becuase £5000 is not going to cover my PCP payments, Insurance/Servcing/upkeep.

Any advice greatly appreciated

zagfles

Wrong forum - best try the "cutting tax" forum. But as I understand it you can claim a tax rebate on the difference between what they pay you and what the government rates are.

AnxiousMum

I know that when I took my job about six years ago, it was originally going to pay a 'car allowance'. This was vetoed, as several of the other women being hired were single parents, and it meant that their income would increase and they would lose out on tax credits. It was then switched to us claiming the 40p per mile and it doesn't show as 'income' in any way.

You would need to keep a mileage log to determine your business from personal mileage. As this is the benefits board though - you might want to post this on the tax board to see if you can get proper information from someone in the know.

Myron_Bolitar

Thanks guys, hopefully somebody will move the thread, if not I will repost in the correct place

cheers