Claimaing Mileage Allowance if possible

jennifernil

As 00ec25 summarised, on the information you have given us, in the tax year 12/13, because you worked only part of the year, you did not earn enough to be due to pay tax. Did you have any other taxable income? Did the total come to more than your personal allowance?

We are assuming that it did not, and that this is the reason why all the tax you had paid was refunded after the end of the tax year.

This meant that as you had paid no tax that year, you could not claim any tax relief on your mileage costs.

Fast forward to this tax year 13/14. You approached your employer regarding mileage, you said they contacted HMRC for you?

" Just an update on my thread! I spoke to my manager about my mileage and they spoke to someone in admin who deals with all the wages etc etc....and they helped to deal with this matter.

Yesterday I received a letter from HMRC headed "PAYE Coding Notice"

and it read "Your new tax code for the year from 6 April 2013 to 5 April 2014 is 1049L which replaces 944L" "

This sounds to me like HMRC have been told that you have ongoing job expenses and have put some relief for them into your code for this year. This will be taken into account when you make your full claim for 13/14.

If you read everything on the P2 notice, it should tell you why they are altering your code. What does it say?

BTW.....I don't see that you need to differentiate between mileage paid at different rates. All you need to keep records of is total business mileage and total payment for mileage received from employer.

You then work out what HMRC allow tax free, subtract the money you were paid, and claim relief on the difference.

oncall

Thanks jennifernil for your detailed response.

I have just checked why they have altered my tax code and this is what it reads:

2. We agree that £1051 is the amount of employment expenses you have to pay during the year for which tax relief is due. You will get tax relief for this amount at the highest rate of tax you pay. For example this could include using your own car for work or hotel and meal expenses. We will continue to include this amount unless you tell us it has changed.

Number 3 reads: We normally split your tax free allowance into monthly or weekly amounts. This means you get about £874 a month, or £201 a week before you employer takes tax off you.

We have changed your tax code after you gave us up to date information.

In Dec 12 my total gross pay was £1111.12, Gross for tax £965.76 and PAYE Tax was £58 and National Insurance was £39.84

Jan 13 Total Gross for tax £1411.78, Gross for tax £1227.78, PAYE Tax £110.40 and National Insurance £71.04


and so forth...............

jennifernil

Yes, that sounds correct, they have put into your current code roughly what you could have claimed last tax year had you paid tax overall.

However, for this current year you will presumably drive further, so should still submit a P87 to claim relief on the full amount.

For 14/15, when they get your figures for 13/14, they will probably use the increased figure. This is how it worked for my husband.

However, you are unlikely to drive exactly the same distance each year, so you still need to submit the figures. If your distance driven decreases, you could well have an underpayment in that year and will have to pay the extra tax.

The figures stated in note 3 refer to the current year and have no bearing on your wages/tax in 12/13.

I see the gross pay figures you have given were more than the taxable, is the difference the mileage you were paid?

oncall

Yes the difference is the mileage I was paid.

I am a bit confused...the P87 I submitted was for year 2012-2013.....and my tax code which has been changed is for 2013-2014.

I am not sure when do I next submit my P87? Is it in April 2014? if so then my tax would again be changed I assume?

I have calculated roughly so far how much mileage I have done since last April to now...and seems quite alot.

I have been paid mileage expenses since April 2013 to date £2,218.08 (at 23p per mile) that is approx 9,643 miles....I still have Feb & March to go which will probably a few more hundred miles on top......

9,463 miles x 45p = 4339.35 - 2218.08 = 2121.27

So 2121.27 'ish the sort of figure I will be roughly looking at......

Would I get relief on that figure 20% of 2121.27 is approx 424.25?

Or would that 2121.27 be added to my tax code...therefore giving me higher tax code?

So confusing all of this.....would I need to submit a P87 in April this year?

Thanks for the reply and help on this.

zygurat789

oncall wrote: »

Yes the difference is the mileage I was paid.

I am a bit confused...the P87 I submitted was for year 2012-2013.....and my tax code which has been changed is for 2013-2014.

I am not sure when do I next submit my P87? Is it in April 2014? if so then my tax would again be changed I assume?

I have calculated roughly so far how much mileage I have done since last April to now...and seems quite alot.

I have been paid mileage expenses since April 2013 to date £2,218.08 (at 23p per mile) that is approx 9,643 miles....I still have Feb & March to go which will probably a few more hundred miles on top......

9,463 miles x 45p = 4339.35 - 2218.08 = 2121.27

So 2121.27 'ish the sort of figure I will be roughly looking at......

Would I get relief on that figure 20% of 2121.27 is approx 424.25?

Or would that 2121.27 be added to my tax code...therefore giving me higher tax code?

So confusing all of this.....would I need to submit a P87 in April this year?

Thanks for the reply and help on this.

Your tax code is an approximation to try and ensure that you get your relief as soon as possible, it can never be correct because the mileage you do in the tax year cannot be calculated until the end of the year so you will have to make do with an estimate and submit the P87 to give the actual figure when you should get a refund or a code amendment for the next year, if you owe them.
The P87 should be submitted annually as soon after 5 April as you can.
Your tax code for 2013/13 is 1049L so you are being given am allowance for £1050 for your mileage which will be deducted from your actual annual figure, currently £2121. So only £214 plus jan, feb and mar to look forward to. Don't forget that 45p per mile becomes 25p after 10,000 miles

oncall

Thanks for the reply.............I am a little confused....the P87 submitted was for miles done 2012-2013....Oct 2012 to April 2013.........

What is confusing is when I submit my P87 would that not be for miles done April 2013 to April 2014?

You say only 214 plus Jan, Feb & Mar to look forward to?

I would have thought that it be from April 2013 to April 2014? Or is this incorrect?

jennifernil

zygurat means that so far you have accumulated a refund due of £214 plus there will be more for January through to the end of this tax year.

You should submit a P87 after the end of every tax year so that your claim can be worked out correctly.

You say you have done almost 10000 miles already, so let's suppose you end up with a total of 13000 miles for the full TY 13/14........

You are allowed tax free 10000 @ 45p = £4500

plus 3000 @ 25p = £750

so £5250 in total

Your employer pays you say (13000 x 23) £2990

So that leave you with a claim for relief on £2260

£1050(if that is correct, please check?) has already been allowed in your code for this year, so you still have a further £1210 to claim relief on. @ 20% this would result in a refund due for this year of £242.

This assumes that your PAYE tax is otherwise correct.

For TY 14/15, HMRC will probably adjust your code to include roughly the amount you were entitled to in 13/14, i.e. the £2260.

I am not sure if you need to specifically request a cheque for the refund you will be due for TY 13/14, the last thing you want them to do is include the refund in your next year's code, it just makes everything really confusing.

I think it is important to keep each TY separate as far as possible, so that you can check you have got the correct refund/paid the correct amount.

Once you have all your figures, get a sheet of paper and write down all your taxable income, expenses incurred and received, and tax deducted and work out the correct figures, then keep it safe till you get the HMRC calculation, hopefully it will agree.

Meantime, keep good records and try to stop worrying about it!

zygurat789

oncall wrote: »

Thanks for the reply.............I am a little confused....the P87 submitted was for miles done 2012-2013....Oct 2012 to April 2013.........

What is confusing is when I submit my P87 would that not be for miles done April 2013 to April 2014?

You say only 214 plus Jan, Feb & Mar to look forward to?

I would have thought that it be from April 2013 to April 2014? Or is this incorrect?

AIUI You submitted P87 for 2012/13 just after April 2013.
There was no tax refund because of this due to the fact that you had not paid any tax after your code no. had been corrected from M1.
As a result of this P87 your 2013/14 code number was increased to recognise the fact that you had claimable mileage, this increased your code number from 944 to 1050. this increase of £1060 of claimable mileage maybe based on your 2012/13 figures but is being given to you in 2013/14 and is on account of what you may claim, when you can claim which is not before 5 April 2014. So when you know your actual figure, in April 2014 you can complete a P87 which will have the effect of
1 Allowing HMRC to ascertain your actual 2013/14 tax liability and
2.They will give you a code number for 2014/15 which will be 10000 plus your 2013/14 mileage claim (as an estimate for the coming year). The resultant number is divided by 10 to get the code number.

Since your code number for 2013/14 already includes an on account figure for mileage it stands to reason that you will not get a refund for the whole of your P87 since you have already had some of it during the year.

jennifernil

P.S.........you need to lay TY 12/13 aside for mileage relief refund purposes as you could not get any refund due to having paid no tax on your income in the end.

Did you actually submit a P87 for that year? I didn't think you were going to, but then you mentioned it in a recent post. Did you get a direct response to that from HMRC?

Basically, they have used the info you, or whoever,gave them as a basis for 13/14 by altering your code, they have not given you a refund for 12/13.

oncall

The P87 that was submitted was for the years (October)2012 up to April (2013), approx 7 months...........

I received a response direct from HMRC......advising that they had changed my tax tax code.