Company car/Expenses/P11d help please

vodka_needed

I am fairly new to expenses/p11d’s (although I have been working in payroll for more years than I care to remember).

I wonder if anyone could advise on the 2 scenario’s below.

Employee 1. Has a company car and fuel card. Private mileage is deducted from salary each month at a rate equal to HMRC advisory rate. Each month EE submits a private mileage record, usually stating something like ‘various journeys around Birmingham – 25 miles’. Am I correct in thinking this is insufficient? Do we require mileage readings and do I need to spot check that the mileage readings are correct? (for individual journeys and odometer readings). Is it correct that in the instances of deducting private mileage, fuel cards are not reported on P11d’s?



Employee 2. Uses his own car, but has a fuel card. The business pays for the fuel card, car maintenance, car tax etc. No deductions are made for private mileage. He has never had a P11d..... What would be my best course of action for this EE?



(In my defence I have only worked here for a matter of weeks– none of the policies/previous practices are mine. I will be changing them though!)



Thanks very much

Savvy_Sue

vodka_needed wrote: »

Each month EE submits a private mileage record, usually stating something like ‘various journeys around Birmingham – 25 miles’. Am I correct in thinking this is insufficient? Do we require mileage readings and do I need to spot check that the mileage readings are correct? (for individual journeys and odometer readings).

I'm going to go out on a limb here, because if I'm wrong just giving an answer tends to bring the experts out ...

If I were your employee, I'd have no issue with reporting my work mileage in absolute and accurate detail for each journey. However, when I clock off at the weekend, I think I'd feel that where I go is my own business, not yours, even if I'm driving your car, as long as I conform to any T&C of the company car.

So unless and until the T&C which go with the company car say "you must record each and every journey whether private or work related", and as long as my works mileage was scrupulously accurate, I can't see what's wrong with '25 miles around B'ham'.

I don't think it's unreasonable that the odometer reading is checked at regular intervals - whether this needs to be given for every journey I don't know. But clearly a responsible employer who is providing a leased car will want to be sure that an irresponsible employee is not clocking up 000s of miles more than the lease agreement allows.

And while you wait for said experts, there always used to be quite helpful info on the HMRC website about such matters. Thankfully I've never had to read those relating to company cars and P11Ds.

Wywth

vodka_needed wrote: »

I am fairly new to expenses/p11d’s (although I have been working in payroll for more years than I care to remember).

I wonder if anyone could advise on the 2 scenario’s below.

Employee 1. Has a company car and fuel card. Private mileage is deducted from salary each month at a rate equal to HMRC advisory rate. Each month EE submits a private mileage record, usually stating something like ‘various journeys around Birmingham – 25 miles’. Am I correct in thinking this is insufficient? Do we require mileage readings and do I need to spot check that the mileage readings are correct? (for individual journeys and odometer readings). Is it correct that in the instances of deducting private mileage, fuel cards are not reported on P11d’s?



Employee 2. Uses his own car, but has a fuel card. The business pays for the fuel card, car maintenance, car tax etc. No deductions are made for private mileage. He has never had a P11d..... What would be my best course of action for this EE?



(In my defence I have only worked here for a matter of weeks– none of the policies/previous practices are mine. I will be changing them though!)



Thanks very much

So you've worked in payroll for years, but are "fairly new to p11d" ? :huh:

And you have only been employed in your present role for matter of weeks? :cool:

I would ask your colleagues about the situation of the two employees, and ask your management/training officer for more training to better undertake the role you are now being expected to perform

vodka_needed

Wywth - Please don't doubt my background. I am CIPP qualified with 15 years experience as a payroll consultant for a multinational company. We always had seperate consultants who would undertake any expenses projects so I have never really had to deal with them (Other than my own!). I took 2 years out after the birth of my children and now work for a small local company (and will do until the children are at school, when I'll get a 'proper' job again).

(btw - it's not just 2 employees - approx half the workforce fall into the 2 categories I mentioned (EE1 and EE2)

I am the Payroll/HR department - all processes need to be reviewed (they are in a complete mess), and this is the one I am tackling first as I thing people are getting away with murder by only contributing (practically) pennies for having a fully expensed car and fuel card.