Fuel Scale Charges and Commuting

jimmo

Its not unusual for an employer’s travel policy to differ from the HMRC policy and its not unusual for employers to blame the taxman when they tighten up their policy.

Sometimes the employer has been caught out by HMRC in a PAYE audit and has to make changes. Sometimes the employer is seeking to cut back on expenditure and it convenient to blame HMRC.

Your employer seems to have latched onto the HMRC statement that “
The application of this rule will depend on the particular circumstances of any case but we will not normally seek to argue that a journey to or from a temporary workplace is substantially ordinary commuting where the extra distance involved is ten miles or more each way.” and taken it completely out of context.

HMRC don’t say they will look. They just leave it that they may look.

In your own particular case your normal commute is 2 miles. Therefore a journey from home to do surveillance of 4 miles is double your normal commute so is far from normal.

If you lived 50 miles away from the office, you travelled 52 miles passing close to the office that might well be a different thing and regarded as normal commuting by HMRC. Regardless of the tax implications I think it is easy to see why your employer would be reluctant to pay you for 52 miles for going to a place maybe 3 or 4 miles from the office.

As it happens, when I was on the road for HMRC, I lived about 2 miles away from the office but travelled much greater distances than you seem to. I also had a colleague who lived about 40 miles away. HMRC, the employer did have a different policy to HMRC, the taxman and, whilst we found our employer’s policy to be fair and reasonable, my colleague considered it worth his while to claim tax relief in respect of the mileage that the employer regarded as private but the taxman regarded as business.
I didn’t.

As you already seem to appreciate, your employer’s “threat” to add the fuel scale charge to your P11D does have some danger to you and HMRC will simply charge you the tax and I fear the only possible way you will overcome that will be a First Tier Tribunal.

However your employer will also face a Class 1A NI liability @ 13.8% on the fuel scale charge.


To me, this has all the hallmarks of an employer trying to tighten the purse strings without doing the required homework and, if you are going to take up the challenge.

You need to know who your enemy is.

Is it your employer or the taxman?

Here’s a bit of bedtime reading for you.

http://www.hmrc.gov.uk/manuals/eimanual/EIM32055.htm

http://www.hmrc.gov.uk/manuals/eimanual/EIM32056.htm

http://www.hmrc.gov.uk/manuals/eimanual/EIM32230.htm

http://www.hmrc.gov.uk/manuals/eimanual/EIM32300.htm