2 incomes/expense claims

Richard019

In my current job we get paid 30p/mile travel expenses. I know for tax purposes you can claim for 40p. Does that mean I can claim the extra 10p 'allowance' from what is currently my taxed income? (ie my employer is unaffected but I effectively get a cut in my basic pay equal to the increase in my expenses)

Secondly, and this is the more complex one, can I claim expenses from one job against the taxed earnings in another? I'm thinking of setting myself up as self employed and paying myself as little as possible whilst establishing myself. In effect I'd be paying myself a basic salary with 0 expenses for things like travel. If my expenses entitlement in that 2nd job was bigger than the wage I was being paid would I be able to claim against my other income in the same way as in the first question?

fengirl_2

Yes, you can cliam tax relief on the additonal 10p per mile (up to 10,000 miles).
You can't offset expenses from one job against another.
The rules for allowable deductions for self employment are different from the ones for employment. In a business you need to include in your accounts all the expenses incurred in earning the income - the expesne has to be wholly and exclusively for the business, but not neceesary - its your business and you decide what expenses need to be paid out.
You should therefore include all your outgoings for the business in the business accounts. If the business makes a loss, you can claim loss relief against your main income.

LittleVoice

As fengirl says, the 40p rate applies up to 10,000 miles. After that it is 25p/mile. If you do more than 10,000 miles but are still paid at 35p/mile for the lot, you need to take that into account.

The answer to "do I effectively get a cut in my basic pay equal to the increase in my expenses" is yes - you don't pay tax on the 10p/mile.