The cost of getting to work.

talksr

Good evening money savers,
I am trying to workout scenarios where you could save on travel costs.

Say that:
My work will pay me business mileage (this is going place to place whilst working) but do not pay for the mileage incurred from getting from home and to work and then back again.

It was suggested to me that although I will not be able to claim my commuting costs back from anyone, I may be able to claim back the vat.

Would there be any truth to this?
I am considering a job which I believe would be similar to this and I would like to know what sort of reimbursement to expect.

Or say that:
My work will provide me with a company vehicle. Would I be expected to insure and tax this vehicle?
I was told that often, companies pay for all of this and even the fuel. Would this be right?

tizerbelle

talksr wrote: »

My work will pay me business mileage (this is going place to place whilst working) but do not pay for the mileage incurred from getting from home and to work and then back again.

It was suggested to me that although I will not be able to claim my commuting costs back from anyone, I may be able to claim back the vat.

Unless you are VAT registered, forget any notion of claiming VAT back. The government work damn hard to eek every last cent out of us through VAT they don't like giving it back to just anyone. Commuting costs are your own costs completely.

However maybe there has been some misinterpretation of what was said / meant re business mileage and tax. HMRC allow 40p per mile business mileage for the first 10,000 business miles per year and then 25p a mile thereafter (assuming you are driving a car). If your employer pays you less than this, you can claim tax relief (at 20%) on the difference between what the employer pays and these rates. You would use this form I believe.

If you get the full 40/25p a mile or more then you can't get any tax relief

talksr

tizerbelle wrote: »

Unless you are VAT registered, forget any notion of claiming VAT back. The government work damn hard to eek every last cent out of us through VAT they don't like giving it back to just anyone. Commuting costs are your own costs completely.

However maybe there has been some misinterpretation of what was said / meant re business mileage and tax. HMRC allow 40p per mile business mileage for the first 10,000 business miles per year and then 25p a mile thereafter (assuming you are driving a car). If your employer pays you less than this, you can claim tax relief (at 20%) on the difference between what the employer pays and these rates. You would use this form I believe.

If you get the full 40/25p a mile or more then you can't get any tax relief

Thanks for your post, it was very useful.

tizerbelle

talksr wrote: »

But I fear that when you say "HMRC allow 40p per mile for business mileage" that this would only include my travel once at work. This is good but I am more concerned about the travel to and from work which is considerably further.

You are on your own with that one. Commuting (getting to work) is classed as a personal expense not a business one so nope, there's no help with that one. The only thing you can do and this assumes you can afford to do it is look for a more fuel efficient vehicle.

Judith_W

At the end of the day you need to weigh up the cost/benefit of travelling that far to those jobs. I currently spend at least £50/wk on petrol to get to work but its worth it as I'm paid more than I could get closer to home and its not as expensive to live out here in the sticks.

talksr

Judith_W wrote: »

At the end of the day you need to weigh up the cost/benefit of travelling that far to those jobs. I currently spend at least £50/wk on petrol to get to work but its worth it as I'm paid more than I could get closer to home and its not as expensive to live out here in the sticks.

Judith,

Thanks for your input. That is why I would rather ask these questions now before I take on such jobs.
:money:

telboyo

If you are spending 65gbp per week getting to work you need to be earning 100 gbp or 5200 p.a to cover this excluding wear and tear on your car you must be doing 400 miles per week 20000 p.a at HMRC rates that would be equivallent to 6.5 K P.a. Factor in 8 hrs per week driving @ 6gbp per ghr that is another 2500 p.a

Is all this effort worth 9k p.a? I was doing the same recently but also living away from home and paying digs worked it out as costing me 16K p.a..
Gave up work and now work 16 hrs per week at min wage and am extremely happy- I don't even need to blag tax and receive no benefits just a occupational pension of 6 K p.a

ceridwen

Never mind HMRC rates of 40p - 25p per mile as "mileage".

The "real" costs per mile can be found on Googlemaps actually for a journey. They have just introduced a little feature on their website - whereby if peeps put in a request for "directions" from A to B they will find that the cost of the petrol has been automatically added at the end of that set of directions.

When I told peeps on the Old Style Board about this - it was pointed out that, in effect, each mile travelled costs 19p in petrol at present (ie rather less than HMRC allows for "mileage"). Someone else pointed out that they had found a way to calculate on from that basic cost of petrol to allow for the fact that their own personal car is a "heavy user" of petrol and takes 40p per mile in their case. Guess this is where HMRC gets that 40p "mileage" figure from? - ie they automatically base the figure on an assumption that ALL cars are "heavy users". This means that "normal user" car owners would make a substantial profit per mile on what petrol costs them.

MsHoarder

ceridwen wrote: »

Never mind HMRC rates of 40p - 25p per mile as "mileage".

The "real" costs per mile can be found on Googlemaps actually for a journey. They have just introduced a little feature on their website - whereby if peeps put in a request for "directions" from A to B they will find that the cost of the petrol has been automatically added at the end of that set of directions.

When I told peeps on the Old Style Board about this - it was pointed out that, in effect, each mile travelled costs 19p in petrol at present (ie rather less than HMRC allows for "mileage"). Someone else pointed out that they had found a way to calculate on from that basic cost of petrol to allow for the fact that their own personal car is a "heavy user" of petrol and takes 40p per mile in their case. Guess this is where HMRC gets that 40p "mileage" figure from? - ie they automatically base the figure on an assumption that ALL cars are "heavy users". This means that "normal user" car owners would make a substantial profit per mile on what petrol costs them.

That's just fuel costs. There's also the capital costs, wear and tear, paying for business use insurance etc. Although we still make a profit! Also, that's an upper limit, and the 25p reduction is to reflect that additional miles over the first 10,000 are less expensive each.

Afraid there's no help with commuting costs though. But if you're spending that much it may be worth looking at alternative vehicles/parking near work and getting the train home or something similar.

kalaika

ceridwen wrote: »

Never mind HMRC rates of 40p - 25p per mile as "mileage".

The "real" costs per mile can be found on Googlemaps actually for a journey. They have just introduced a little feature on their website - whereby if peeps put in a request for "directions" from A to B they will find that the cost of the petrol has been automatically added at the end of that set of directions.

When I told peeps on the Old Style Board about this - it was pointed out that, in effect, each mile travelled costs 19p in petrol at present (ie rather less than HMRC allows for "mileage"). Someone else pointed out that they had found a way to calculate on from that basic cost of petrol to allow for the fact that their own personal car is a "heavy user" of petrol and takes 40p per mile in their case. Guess this is where HMRC gets that 40p "mileage" figure from? - ie they automatically base the figure on an assumption that ALL cars are "heavy users". This means that "normal user" car owners would make a substantial profit per mile on what petrol costs them.

I always thought the 40ppm was what HMRC classed as an acceptable level that related to petrol and general maintenance costs of the vehicle as an average. So the average of, say, 19ppm that coverered the fuel was then topped up with 21ppm to cover the other running costs (business insurance, maintenance, etc). The 40ppm hasn't changed for many years so it unlikely to really reflect the actual running costs any more, but I don't think HMRC are planning on changing it any time soon.

ETA - crossed with MsHoarder

talksr

ceridwen wrote: »

Never mind HMRC rates of 40p - 25p per mile as "mileage".

The "real" costs per mile can be found on Googlemaps actually for a journey. They have just introduced a little feature on their website - whereby if peeps put in a request for "directions" from A to B they will find that the cost of the petrol has been automatically added at the end of that set of directions.

Thanks, very interesting.