Tax relief on vehicle mileage

06hallja

Hello,

I’m going to be starting work as a pizza delivery driver for a well-known chain; this will be a part time/evening second job working 20 hours per week @ £7.05 (my nmw for my age) for me so my tax on this will be 20%.

I will be using my own car, with them paying me .90p (tax free) per delivery and I should average 4 drops per hour. But I was wondering if I could still claim my tax back.

For example (I will be logging my exact mileage, when I start):

4 drops per hour on a 5 hour shift is 20 drops, which is £18, so £72 (tax free) per week, £3744 per year.

The rough area I will be covering, is roughly 6 miles there and back to shop, so about 480 miles per week.

Using the current system in place its 45p for the first 10,000 per year which is £4500, then at 25p after that which is £3740, so combined £8240.

So could I claim an extra £4496 tax relief?

Many Thanks,

Jack

Pennywise

06hallja wrote: »

Hello,

I’m going to be starting work as a pizza delivery driver for a well-known chain; this will be a part time/evening second job working 20 hours per week @ £7.05 (my nmw for my age) for me so my tax on this will be 20%.

I will be using my own car, with them paying me .90p (tax free) per delivery and I should average 4 drops per hour. But I was wondering if I could still claim my tax back.

For example (I will be logging my exact mileage, when I start):

4 drops per hour on a 5 hour shift is 20 drops, which is £18, so £72 (tax free) per week, £3744 per year.

The rough area I will be covering, is roughly 6 miles there and back to shop, so about 480 miles per week.

Using the current system in place its 45p for the first 10,000 per year which is £4500, then at 25p after that which is £3740, so combined £8240.

So could I claim an extra £4496 tax relief?

Many Thanks,

Jack

No, your travel costs attract tax relief at your usual tax rate, you don't get 45p back, you get 20% (normally) of the 45p. So your milage claim is £8,240 less the £3,744 they pay you leaves £4,496. 20% tax relief on the £4,496 is £899.20. So your tax bill will be reduced by £899.20. All assuming that all the travel costs are allowable in the first place.

06hallja

Perfect, thank you, I did think it was high!!

But still £900 is better thank a kick in the teeth!

unforeseen

Courier insurance for an under 25 must be making a big dent in your net income.

You'll probably find that you can take home more on JSA

sheramber

unforeseen wrote: »

Courier insurance for an under 25 must be making a big dent in your net income.

You'll probably find that you can take home more on JSA

Not when he has another job .

06hallja

There is lucky no insurance cost as they are covering me for business use on there insurance policy.

sheramber

06hallja wrote: »

There is lucky no insurance cost as they are covering me for business use on there insurance policy.

Is that fully comprehensive or third party only? If third party only if you are at fault in an accident your vehicle will not be covered, only that of th other party.

Another poster reported that it was third party only and he was having problems with his own insurance company over this.

hareng

06hallja wrote: »

There is lucky no insurance cost as they are covering me for business use on there insurance policy.

I would want to see the policy and how its linked to your vehicle!