Increase to Mileage Allowance?

Mids_Costcutter

The 40p rate per mile (for the first 10,000 miles) is the statutory rate free of tax. If employers deem that their staff 'need' to drive a high-performance / luxury car of their own for business use, then they can of course pay a higher mileage rate but it would be subject to tax and NICs. If an employer pays less than 40p / mile than an employee can claim tax relief on the difference from HMRC.

Andy_L

lisyloo wrote: »

Ibut I never expected it to last 17 years, so I thought I would have to change it before now.

Good effort, I'd of probably wrapped it around something by now;).

lisyloo

What like some crazy executive on his way home from the airport :rotfl:

Pont

Going back to the original question I've worked for the Local Authority for the last 5 years, and am deemed an essential car user. We're paid 31p per mile at the moment, I think it was around 28p per mile when I first started.

My understanding is that we should also receive approximately 1000K per year 'lump sum' but nobody from my department has ever received it - is this right?

My LEA's website states that essential car users will be paid 34.6p per mile but obviously we're getting less than this. Are there different rates for essential car users?

At present I'm driving around 5000 miles a year solely through work (I have to travel around to visit clients at their houses) plus about another 3000 personal use. It never struck me as correct that no account was taken of additional wear and tear on our cars, depreciation of car value due to high mileage etc.

Couple of extra questions!
1) If the lump sum isn't paid by the employer can you claim it back from the tax office, or is the employer responsible for ensuring you receive it?

2) If it's possible to claim back the difference in mileage payments (40p - 31p = 9p per mile) via the tax man has my employer any liability in not informing me of this?

3) When my employer pays my mileage claim every month this amount is subject to tax, is this correct?

Any help to the above greatly appreciated - thanks in anticipation.

Shiggaddi

Make sure you keep a record of how many miles you do each month, which I'm sure you do, as you get a claim form to fill in.

Then at the end of the year, you need to add the cost of 40p per mile, minus any amount that has already been paid, which includes your 31p per mile, plus any lump sum that you may get in the future if you persue this.

If the cost of 40p per mile is higher than the lump sum plus 31p per mile, then you can get a tax rebate on the difference.

If the lump sum pushes the amount above the 40p per mile, then I'm afraid you'll have some extra tax to pay.

Pont

Thanks Shiggaddi for the post.

I've got records for all of last years mileage in my work diary ('fraid previous diaries now binned), and can work out all other years from my salary slips (divide amount paid by amount paid per mile). It's going to get really complicated because I paid tax on the petrol expenses paid to me for 5 years! In excess of £150.00 per month was treated as taxable income when it shouldn't have been (again over 5 years). If we take it that NICs, (not sure about student loan repayments, tax credits etc) are calculated from pre tax income then the plot thickens! I can't believe this, as when I received my very first salary slip I questioned the fact that tax had been applied to my petrol expenses and was told, 'that's the way it is' by the payroll department! At the risk of sounding like 'Disgruntled of Tunbridge Wells', no wonder the country's in such a mess when the local authority can't take a look at the IR website - it took me all of 5 minutes to find this information out. Hmmm, wonder how much the Director of Finance gets paid at County Hall?!!!!

Has anybody out there had a similar experience, and more to the point did you get your money back?