HMRC Mileage Allowance Relief

stix7777

Hi all
new to this forum so please bare with me.
I joined a new company last October and I have a car allowance which allows me to buy my own car and use it for work purposes. I claim back my mileage monthly from my employer at 26p per mile. I have just gone to do my self assessment tax return in order to claim back the difference between the Gov advised rates (45p per mile for the first 10k miles etc).

Calculations below

total business miles covered 11449 miles

10000 x45p = £4500
1449x25p = £362
total MAR  =£4862

payments received from the company 
11449 x 24p = £2747.76

MAR £4862 - payments from employer £2747.76 = £2114.24 due to be reimbursed from HMRC

however at the end of the self assessment it says that the total amount of tax repayable to me is £936.82????

I don’t understand how they have come up with that figure? Any ideas?

thanks 

stix7777

Sorry mileage from the employer is 24p a mile not 26p a mile

HappyHarry

You are due tax relief on the difference, not a refund.

In your case you will get tax relief on 1149x£0.21 = £2404.29 of your income.

For a 40% taxpayer this would be a reduction in tax of c£962.

Isthisforreal99

Seems you want us, the taxpayer, to subsidise the fact your employer doesn't pay you the full amount they could tax free.

stix7777

Thanks HappyHarry, that helps.

Dazed_and_C0nfused

stix7777 said:

Thanks HappyHarry, that helps.

As you will have now realised persuading your employer to pay more than 24p/mile will give you a better outcome than claiming tax relief.

LITRG

Hi stix7777 you might find our website guidance on employment expenses when using your own car helpful in this situation: https://www.litrg.org.uk/working/employment/taxable-employment-income/employment-expenses-using-your-own-car . All the best