Tax on mileage expenses

BevieB

Hi,

I currently receive expenses as I visit customers as part of my job. When submitting my expenses I have to apply a home to office deduction which means I take away 2 miles @ £0.13 for 1 way. For example if I go straight home from my visits I have to take off £0.26 from any expenses paid as my journey from office-home is 2 miles.
Last week our manager has stated that if our first or last journey is in the same direction as the office we cant claim for the expenses to the first or last journey unless we are taxed on the expenses for this journey but they still need us to deduct the home to office deduction.
Is this right? as surley by applying the home -office deduction we have no need to be taxed.
Hope this makes sense.

InsideInsurance

Cant tell you if its right or wrong but I did work for a company that had a very similar approach in terms of if you were travelling somewhere which covered part of the theoretical route to the main office (I caught the train to main office so it was theoretical) you had to deduct that off of the mileage claimed. If you went in no way along the same way then you could claim the full journey.

I did question it and they sent me some HMRC guidelines that werent too clear from my perspective but as I didn't drive too often it didnt make the greatest difference.

oscarward

my company policy is that all work journeys I have to deduct home to office mileage irrespective of direction.

IIRC when I worked in local goverment the policy was the same, the answer was to go in to the office first which sometimes cost them more miles :rotfl:

BevieB

oscarward wrote: »

my company policy is that all work journeys I have to deduct home to office mileage irrespective of direction.

IIRC when I worked in local goverment the policy was the same, the answer was to go in to the office first which sometimes cost them more miles :rotfl:

4

I work for the DWP. It just seems silly to pass my home, then have to pay for parking (claim back as expense) My point is that if they are not paying me for my normal office-home journey as deducted from expenses how can they restrict it further by taxing me on miles claimed on the similar travel as office/home.
It seems that I will have to drive to office (park outside) claim this on expenses.Then leave and work from home later.

easy

BevieB wrote: »

Hi,

I currently receive expenses as I visit customers as part of my job. When submitting my expenses I have to apply a home to office deduction which means I take away 2 miles @ £0.13 for 1 way. For example if I go straight home from my visits I have to take off £0.26 from any expenses paid as my journey from office-home is 2 miles.
Last week our manager has stated that if our first or last journey is in the same direction as the office we cant claim for the expenses to the first or last journey unless we are taxed on the expenses for this journey but they still need us to deduct the home to office deduction.
Is this right? as surley by applying the home -office deduction we have no need to be taxed.
Hope this makes sense.

How much are you paid per mile? Are you using your own vehicle, or is it a company provided vehicle which you buy fuel for?

BevieB

easy wrote: »

How much are you paid per mile? Are you using your own vehicle, or is it a company provided vehicle which you buy fuel for?

I use my own car and receive 45p per mile.

jonesMUFCforever

The first 10,000 miles at 45p per mile is tax free - anything over that is taxable.

BevieB

jonesMUFCforever wrote: »

The first 10,000 miles at 45p per mile is tax free - anything over that is taxable.

I'm am aware of this. The problem is with the first and last journey if it is in the the general direction of my home. Eg I have 4 visits in the day I set of from my office and my last visit ends between the office and my home. Therefore I have to deduct a home to office deduction of 2 miles and only claim expenses to last visit. If I claim from last visit to home I must pay tax on it. I feel that by having the home -office miles deducted from any claim they should not tax me further for any mileage.

jimmo

Many moons ago the Civil Service travelling and subsistence scheme precisely matched the Income Tax rules and we all knew exactly where we stood. In those days the basic rule was that you could claim the extra cost of travelling on business.

In other words if your normal journey from home to office cost you £2 but you undertook a business journey from your home to a place other than your normal place of employment and it cost you £10 then the cost to you, over and above your normal commuting cost, would have been £8. In those days £8 was what you could claim from your Civil Service employer and because the employment and tax policies matched there would be no tax consequences.

Since then, there have been 2 very significant changes.

The Civil Service wide travelling and subsistence policy has gone. Nowadays each department or agency etc is empowered to set its own travelling and subsistence policy.

HMRC’s interpretation of the tax rules changed. From memory, it was at some time in the early 1990s when the concept of identifying a journey from home as either normal commuting journey, not allowable for tax purposes, or a business journey, totally allowable for tax purposes, came into being.

When all that happened those of us who worked for the then Inland Revenue understood what was going on but it did seem to be pretty daft.

We were claiming travelling expenses from our employer but also claiming tax relief on the travelling expenses which were allowable for tax purposes but our employer refused to pay.

That, I am afraid, is what you seem to be facing.

In practical terms your employer sets the rules on what it is prepared to pay you in travelling expenses but HMRC sets the rules on what is allowable for tax purposes.

In your original post you seem to say that your employer is knocking you for 13 pence per mile in respect of your normal journey from home to office but in post #6 you say you are paid 45 pence per mile for business travel. That doesn’t make sense to me. Can you explain?

BevieB

jimmo wrote: »

Many moons ago the Civil Service travelling and subsistence scheme precisely matched the Income Tax rules and we all knew exactly where we stood. In those days the basic rule was that you could claim the extra cost of travelling on business.

In other words if your normal journey from home to office cost you £2 but you undertook a business journey from your home to a place other than your normal place of employment and it cost you £10 then the cost to you, over and above your normal commuting cost, would have been £8. In those days £8 was what you could claim from your Civil Service employer and because the employment and tax policies matched there would be no tax consequences.

Since then, there have been 2 very significant changes.

The Civil Service wide travelling and subsistence policy has gone. Nowadays each department or agency etc is empowered to set its own travelling and subsistence policy.

HMRC’s interpretation of the tax rules changed. From memory, it was at some time in the early 1990s when the concept of identifying a journey from home as either normal commuting journey, not allowable for tax purposes, or a business journey, totally allowable for tax purposes, came into being.

When all that happened those of us who worked for the then Inland Revenue understood what was going on but it did seem to be pretty daft.

We were claiming travelling expenses from our employer but also claiming tax relief on the travelling expenses which were allowable for tax purposes but our employer refused to pay.

That, I am afraid, is what you seem to be facing.

In practical terms your employer sets the rules on what it is prepared to pay you in travelling expenses but HMRC sets the rules on what is allowable for tax purposes.

In your original post you seem to say that your employer is knocking you for 13 pence per mile in respect of your normal journey from home to office but in post #6 you say you are paid 45 pence per mile for business travel. That doesn’t make sense to me. Can you explain?

When applying home-office deduction it seems that the amount we are deducted is based on petrol used only as the rate is calculated from the PUS/lease car figures or we can use the cost of a season pass for bus etc if lower. Therefore the deduction is the actual cost of the petrol/bus which we would have paid and does not take into account running cost of car which is included within the 0.45. Hope this makes sense.

princessdon

So you get 45p per mile

Your home/office deduction is 13 p per mile?

So under current rules you get 32p per mile for your travel to work as expenses?

Very complex system for mileage - We simply claim either from office or if in direction of office less our home distance. Ie we don't claim the full 45p for the home/office distance.