Millage Allowance Claims

Diplomat365

Recently I've noticed that you can claim back milage if your company pays less than the 40p per mile allowable. Does anyone have any templates / links for information on doing this?

My company pays at approx 20p per mile or less depending no fuel prices and I've been with them for 4 years so I have a fairly large claim to make.

Any help would be great

withabix

You can claim back the tax element (20% or 40% or whatever was applicable for the tax year in question) of the difference IF it is your own car. If it is a Company Car, there is no claim allowed.

You need to submit full mileage records for the relevant years.

If your employer pays 20p/mile and you pay 20% tax, then for the first 10,000 miles you can claim (40p-20p) * 20% * miles. After 10,000 miles it is (25p-20p).

Mileage rate changed to 45p this tax year.

You can only claim for TRUE business miles, excluding the journey between your home and your work base, which is classed as 'travel to work' and receives no tax relief.

P87 is the form you need (unless you do Self Assessment):

http://www.hmrc.gov.uk/forms/p87.pdf

Diplomat365

Thanks very much for this, the car is my own car (I recieve cash in lieu of a car from my employer) and all milage is business as I have it all recorded on my expenses forms since I joined the company.

If I understand what you're saying correctly if for example I had done 5000 miles @ 20p recalim the claim would be for:

(0.4 - 0.2) *0.2 * 5000 = £200

And this amount is all logged in the P87 less the amount I was paid. I assume there is no limit to the number of years I can retrospectively submit?

Technically I could charge for the commute to my local office as I'm mobile so my office counts as my home but I've never logged those miles so will ignore them.

withabix

You can go back 6 years I think, although you are best calling your HMRC office to confirm the easiest way to do this.

I've never used a P87 as I've always been on Self Assessment, as you will be as well from this year. Submitting a P87 will trigger this.

Diplomat365

One last question, if you were on 40% tax I'm assuming you'd get the rebate at 40% not 20%

John_Pierpoint

Your expenses (say 20p a mile) will reduce your taxable income and if the top slice of your income is paying 40% tax the you will save 40p on each pound so claimed (until your top slice drops down into the 20% band).