Mileage tax reclaim?

jessicarabbitrachel

Ok, I'm not very bright at these things...

So I started working for my company in Jan 2012. I am reimbursed 35p for every mile. So roughly I did 2100 miles (and claimed £735) in 2011-2012 tax year and 7100 (£2485) in 2012-2013. I am aware that HMRC mileage rate is 45p per mile, but I'm not sure how to claim. I have read the HMRC guidance on their website but I think this means for 2012-2013 I need to fill out a self assessment form due to the amount of my claim??? And a form P87 for the previous tax year? Is this right? Is the amount of allowable expenses what I have claimed from my employer or what? I have read and reread and rereread the HMRC website and tried to speak to them on the phone but I can't get through and suspect my phone bill will end up higher than any eventual tax rebate at this rate!

Also, my co-worker (who earns loads more than me!) thinks if she claims it will put her in a higher tax band - I assume she is wrong in this as a tax rebate surely couldn't push you into the top rate of tax in terms of income could it? She also thinks it could count as a second income - again, I don't think she can be right.She does a lot more miles than me.

Please help - I'm generally fairly intelligent but this has foxed me. I just need to know what steps to take? Thanks peeps :-)

Dazed_and_confused

I think other posters have found it is the net amount that determines if you need to fill in a tax return. You will be claiming well under £2500 each year so you might be able to complete a P87 form for each tax year - you could do 2011/12 now but would need your P60 for for this year I think

Don't forget you only get tax relief on the amount you claim so if you have no complications you can expect £40 for 2011:12 and £140 for 2012:13 if you pay basic rate tax.

I have no idea what your co worker is on about - a mileage claim reduces your taxable income, how this could push you into a higher tax bracket defeats me!

Did you find this page on HMRCs website - it seems to set things out quite clearly
http://www.hmrc.gov.uk/incometax/relief-mileage.htm

jessicarabbitrachel

Thanks for your reply.

Ok...so maybe I'm thick here - but if I did 2100 miles in 11-12 and was paid 35p per mile (and therefore am claiming the extra 10p back from HMRC, should the amount not be £210 for 11-12 @(and £710 for 12-13)? that is the 10p per mile difference is it not?

either way, you reckon I complete the appropriate form based on the amount I wish to claim back from HMRC, not based on my original claim from my employer?

I should have said before, I am not paid expenses through payroll, I am paid separately by direct bank transfer from my employer on a different day - so my P60 won't show anything although I have mileage claim forms for the full period. Do you think this changes anything?

Dazed_and_confused

This is a very common misconception on the Cutting Tax board.

You are correct that your 2011:12 claim will be for £210 but this is a business expense so it reduces the amount you pay tax on i.e.
Salary 20000
less expenses 210
less personal allowance 7475
taxable income 12315
tax due 12315 x 20% = 2463

On a normal tax code of 747L you would have paid tax of £2504 in 2011:12 so you get £41 back (2504 paid 2463 due = £41)

You can look at a P87 on HMRCs website but I'm pretty sure that you mustn't just enter £210. I think you have to give the following figures,
business mileage 2100 x 45p (if under 10000 miles) = 945
less amount reimbursed by employer £735
= expenses you wish to claim £210

Your P60 won't show anything to do with your business mileage/expenses but HMRC will need it to calculate any repayment. They will already have a copy for 2011:12 but your employer doesn't have to send them a copy of your 2012:13 P60 until the end of May so it's usually quicker for you to provide your copy (keeping a photocopy in case it goes missing!)