How to reclaim business mileage?

LionKing

Hi,

I use my own car for business related travel and currently receive 19p/mile from my employer.

I understand i can claim the difference 21p back from government (40p - 19p).

I have found a form called P87 (tax relief for expenses) on HMRC website (http://www.hmrc.gov.uk/forms/p87.pdf ). Is this the correct format to reclaim the difference or do i need to do a tax return?( I am a PAYE employee and have never done a tax return before).

I do roughly 5000 miles a year and have not claimed difference for last three years.

Are my calculation correct:

• 5000 miles @ 19p = £950
• 5000 miles @ 40p = £2000
• Money owed: £2000 - £950 = £1,050 per year

1. Is this correct or am i subject to tax on the money owed??
2. Can i reclaim for the last three years or have i missed the boat?
3. I have checke my P11D and although i claim my mileage back ia my companies expense procedure, the mileage expense is not listed on my P11D. Does this impact how i claim back the 19p differential?

Apologies for all the questions but confused by process!

CLAPTON

I'm afraid the HMR refund the tax on that amount and not the actual amount so your refund wil be 22% of 1,050 = £231 assuming you are a standard rate payer

LionKing

Thanks Clapton, why do they only refund the tax?...sneaky as the 40p statement is a bit deceiving and makes it more complicated!!

Is the P87 the correct form and does it matter not stated on P11D

RayWolfe

Because your employer is running the business not the rest of us!

aelengland

I too work for a local eduaction authority, and i do about 500 miles a month. They re-imburse me some of my mileage, i am not sure what rate at, but then i pay income tax on the money i get back. I find this weird getting taxed on mileage/petrol that i have already paid for...is this correct or is there some way of claiming the tax back on this that i have been paying?..please help

LionKing

I don't get taxed on the 19p my company pays me as paid to me as expenses. Is this correct?

Is the P87 the correct form to reclaim mileage and does it matter my mileage payment is not stated on P11D?? Should i be taxed on the 19p my company pays me?

Andy_L

aelengland wrote: »

I too work for a local eduaction authority, and i do about 500 miles a month. They re-imburse me some of my mileage, i am not sure what rate at, but then i pay income tax on the money i get back. I find this weird getting taxed on mileage/petrol that i have already paid for...is this correct or is there some way of claiming the tax back on this that i have been paying?..please help

If it's below the inland revenue limit of 40p/mile you should not pay tax on it

LionKing

I don't get taxed on the 19p my company pays me as paid to me as expenses. Is this correct?

Is the P87 the correct form to reclaim mileage and does it matter my mileage payment is not stated on P11D?? Should i be taxed on the 19p my company pays me?

cosyc

LionKing wrote: »

I don't get taxed on the 19p my company pays me as paid to me as expenses. Is this correct?

Is the P87 the correct form to reclaim mileage and does it matter my mileage payment is not stated on P11D?? Should i be taxed on the 19p my company pays me?

only mileage in excess of 40p goes on P11d so nil for you. Can also send a letter, don't ask for a tax return.

cosyc

aelengland wrote: »

I too work for a local eduaction authority, and i do about 500 miles a month. They re-imburse me some of my mileage, i am not sure what rate at, but then i pay income tax on the money i get back. I find this weird getting taxed on mileage/petrol that i have already paid for...is this correct or is there some way of claiming the tax back on this that i have been paying?..please help

most LA have two schemes casual or essential user allowances some pay a flat rate per month then a lower per mile or a higher per mile. both overall are inlcuded to work out if any motoring in excess of 40p (first 10000 miles only).