How to claim tax back on business mileage?

movilogo

I am an employee (PAYE) and use my personal car for my employer's business.


As per HMRC rule, I am entitled 45p/mile. But my employer reimburses me at rate of 13p/mile.


Can I claim back tax on (45p - 13p) * Total Miles ( = say £x)?


What exactly I shall get back from HMRC? Assuming I'm higher rate tax payer, shall I get back x * 0.4?


The P87 form in HMRC website says I can claim only if total claim is less than £2500 in a tax year, otherwise I have to do self assessment tax return.


How do I calculate my claim is over or below £2500?

Darksparkle

You calculate it as you say:

Business Miles x 32p.

If this amount is less than £2500 in the tax year then claim via P87.

If this amount is more than £2500 then register for self assessment.

Your business miles would need to be about 7850 in the year to be more than £2500.

movilogo

Is there any cut off date for this claim? I have not claimed my 2014-2015 tax year expenses. Can I claim now?


Which tax year do I select for 2014 Apr to 2015 Mar claim?


https://public-online.hmrc.gov.uk/lc/content/xfaforms/profiles/forms.html?contentRoot=repository:///Applications/PersonalTax_iForms/1.0/P87&template=P87_en_1.2.3.xdp

Darksparkle

Deadline for 2014/15 is 5th April 2019.

If you are claiming for 6th April 2014 to 5th April 2015 that is the tax year 2014/15.

fruitisbad

Can also claim back upto 4 years worth

movilogo

Do I need to wait until tax year ends (i.e. April 2016) if I want to claim for 2015-16 tax year?


I assume in this remaining 3 months I won't incur any business mileage.

Darksparkle

movilogo wrote: »

Do I need to wait until tax year ends (i.e. April 2016) if I want to claim for 2015-16 tax year?


I assume in this remaining 3 months I won't incur any business mileage.

Yes you would need to wait.

jimmo

On this forum the most common examples of people seemingly being paid miserly rates for using their own cars are carers in the care industry. There it seems the employers are truly miserly. As you are a higher rate payer it feels reasonable to assume you are not a carer.
Apart from those the only other examples are:
1) people who are paid (and taxed on) car allowances.
2) people who pay for their own cars through salary sacrifice.
For those in (1) it is entirely correct to claim tax relief.
For those in (2) the salary sacrifice arrangement actually means that it is not their own car. It is a company car and no tax relief is due.
Do you perhaps fit either of those?

isplumm

Darksparkle wrote: »

You calculate it as you say:

Business Miles x 32p.

If this amount is less than £2500 in the tax year then claim via P87.

If this amount is more than £2500 then register for self assessment.

Your business miles would need to be about 7850 in the year to be more than £2500.

I assume that this only for the 1st 10000 miles, because after that it drops to 25p a mile.

So if the OP does more than 10000 business miles in a tax year, then the calculation would be:

first 10000 miles - £0.32 x 10000.
rest - £0.12 x business miles

Mark

Dazed_and_confused

Using 12000 miles as an example and assuming the employer pays the same rate on all mileage is the correct calculation not,

10000 miles x 45p = 4500
2000 miles x 25p = 500
Gross expenses = 5000
less employer reimbusement
12000 x 13p = 1560
Net expenses = 3440

NB. Don't forget any tax refund, looking just at the expenses, would be between £0 and £1548 depending on your tax rate

movilogo

I have filled up P87 form but it then says as my claim is over £2500 I need to do self assessment

I am only claiming for 3040 miles in 2014-15 tax year.

Which multiplied by 45p becomes £1368
Minus employer reimbursed £454.

So total mileage relief is £914.

But then the generated PDF displays this.

What to do now
Your claim is more than £2,500 so you will need to fill in a Self Assessment tax return.
Please contact the Self Assessment Helpline on 0300 200 3310 or follow the link below

How did it get the over £2500 figure? I tested with some made up details as well and get same generated message.