Low mileage rates paid by my employer

dougie84

I'm a vet and regularly use my own car to go on visits to client's houses and to drive between branches.

Until now, I've always been paid at 40p per mile, which although below the HMRC advised figure of 45p per mile at least covered my costs.

However, without any discussion, they have now started splitting the mileage calculation into "client miles", those charged to a client for home visits etc, and "practice miles", those charged for driving between branches. Client miles are paid at 45p per mile, but practice miles at only 14p per mile. This new rate barely covers my fuel let alone other costs of motoring. The change has left me out-of-pocket by £50 in the last three months compared with the old flat-rate system, and worse costs me money (in tyres, servicing, depreciation etc) every time I do practice miles.

There is a clause in my contract that says I have to provide my personal car for business use so I can't refuse to drive altogether. Is there anything else I can try?

Seems a little unfair.

straighttalker

Change jobs.

SeduLOUs

Did your contract stipulate the amount you would be reimbursed for miles? If so, this 'change' is a change to the contract and therefore needs your agreement (although refusal to agree could result in worse, depending on how long you have been employed etc)

If not I think you might be stuffed

dougie84

Contract just says that I'll be paid at "agreed rates", but these were not discussed when I started working and I've not seen them since.

I heard I may be able to put in a tax refund claim for the difference between what they're paying and the HMRC rate - anyone know anything about this? Would it be for the full amount, or would it be tax relief on the amount (ie 20% at basic rate)?

dougie84

straighttalker wrote: »

Change jobs.

Thanks for the helpful advice.

bod1467

Probably better to ask someone who is au fait with tax law, but I'd suspect you'd be able to offset the full difference against your annual income tax liability.

SeduLOUs

dougie84 wrote: »

Contract just says that I'll be paid at "agreed rates", but these were not discussed when I started working and I've not seen them since.

I heard I may be able to put in a tax refund claim for the difference between what they're paying and the HMRC rate - anyone know anything about this? Would it be for the full amount, or would it be tax relief on the amount (ie 20% at basic rate)?

I'd probably argue then that the 'agreed rates' means agreed between you and employer, and refer to the rates that you agreed to by accepting payment for until recently.

The new rates are not 'agreed' by you and constitute a variation to your contract that you are not willing to agree to.

Next step might be to phone ACAS to see if I'm talking nonsense (I'm only applying common sense and no real legal experience)! :rotfl:

Anything you could 'claim' from HMRC would be tax relief, not a lump sum payment of the difference.

forgotmyname

14p is approx 35mpg. for fuel alone. Is that about right for your car?

As above though i think you need proper legal advice on this one.

What sort of mileage are you covering?

dougie84

Yeah, that's about right - it's only a small car.

Probably only do around 1000 business miles a year (of which about 250 are client miles) so the difference between the old and new systems is only about £200 a year. It's not enough to make a big fuss about at work.

Still, it's the principle of the the thing that annoys me and the fact that I'm currently subsidising my employers by paying for driving that I'm doing on their behalf.

gilbert_and_sullivan

Straightalker has a point, they've done this and you're still working the same as before, what's to stop them cutting the client miles by the same amount.

If the job's good enough in other ways that you don't mind subsidising their transport costs, then you have the choice of putting up with it, or if it's the straw that breaks the camels back, of finding another job.

I'd enquire with the tax office about claimable business miles anyway.

lesalanos

dougie84 wrote: »

However, without any discussion, they have now started splitting the mileage calculation into "client miles", those charged to a client for home visits etc, and "practice miles", those charged for driving between branches. Client miles are paid at 45p per mile, but practice miles at only 14p per mile. This new rate barely covers my fuel let alone other costs of motoring. The change has left me out-of-pocket by £50 in the last three months compared with the old flat-rate system, and worse costs me money (in tyres, servicing, depreciation etc) every time I do practice miles.

Not to mention increased insurance costs for business use :mad: