Business mileage reclaim

sefo1979

Hi all, gone through many threads and am finding different responses to the issue I have. Basically I only get 34p a mile for using my car for work. I submitted a p87 for the difference between what the company had paid me(tax free) for last year and received a cheque and an adjustment to my tax code which by April next year will mean I get the full amount submitted. Although not a windfall payout I will recoup what I'm owed.
I did the same for the previous tax year 11-12 the amount owing being £1030. I have received my p800t back stating that I am only entitled to £205.48 for that year. I immediately called the tax helpline and after a 28 minute wait an extremely bored operator answered my call I explained the situation and was met with a response of "yeah that's right you only get 20%"
I questioned if this was correct as my fuel allowance isn't taxed and he was adamant it was right for the figure I submitted.
Obviously not being happy with his response I asked well how do I get the full amount back and he stated I should have submitted the the total that I should have been paid including what I had been paid by my employer! I don't believe this is true can anyone help obviously the system falls down somewhere as thus years works out spot on.

rs65

You are claiming tax relief on the amount - not the amount itself.

£1030 at 20% = £206.

rs65

The refund you got was presumably for 2012/13. The adjustment to your tax code is in anticipation of you doing a similar business mileage for 2013/14 so your tax is adjusted during the year.

sefo1979

Is there a way to claim the full amount as its tax free?

00ec25

sefo1979 wrote: »

Is there a way to claim the full amount as its tax free?

your company pays you 34ppm as a tax free amount. HMRC allows companies to pay up to 45ppm (for the first 10,000 miles only) tax free. What that measn is you do not have to PAY tax as long as the total is no more than 45ppm. If you get more than that then you will have to pay tax on the amouynt over 45p, that is what is meant by tax "free"

what you don't seem to understand is that the Government (ie us taxpayers) will not pay you the extra 45 - 34 = 11 ppm as it is not the taxpayers role to subsidise the expenses policy of your company who have chosen to pay you less than 45p. However, the Govt reckons it "costs" you 45ppm to run your car, so HMRC allows you to reclaim the tax you had to pay on the money you earned in order to be able to have the cash to run the car costing you 45ppm.

You cannot reclaim the "full" amount of 45ppm as the Govt is not paying you to run your car but HMRC has the tax you have paid on the money you earned so is allowed to give you back that amount of tax

as per #2 you are reclaiming 20% or 40% (depeniong on your tax rate) of 11 pence per mile