Fuel Tax Relief

scottkeene · 13 December 2016 at 2:23PM

Hi,

I am an employee for a company and have allowance which I use to pay for a company car. When I go on trips with work I claim the 9p/10p etc mile for expenses.

But, can I claim the tax relief as per the gov.uk website which it refers to (sorry, cannot add link under my new account) for the difference? If so, what is the higher limit (is it my income tax amount) and how far back can I go? I assume I'll need to do it via self-assessment?

Thanks in advance.

singhini · 13 December 2016 at 2:46PM

when you say you get a car allowance I'm assuming this is paid into your salary monthly and you use this money to provide your own car which you pay everything for i.e. you pay for fuel, servicing, car insurance, road tax etc....

And at the end of each month your employer pays you 10p per mile.

If I have got the situation correct, yes you can claim tax relief on business miles.
This is how I understand it
HMRC is 45p for the first 10,000 miles and then 25p thereafter.

So lets say you did 21,000 miles in a year, that would mean
10,000 x 45p = £4,500
11,000 x 25p = £2,750
TOTAL = £7,250 Less £2,100 (this is 21,000 x 10p paid by your company) = £5,150

lets say you are a 20% tax payer, so 20% of £5,150 = £1,030

You might not need to do a full self-assessment, you might be able to just fill in a p87 form https://www.aber.ac.uk/en/media/departmental/finance/pdf/p87-mileage-rate-tax-relief.pdf

If the link doesn't work, try googling p87 refund form

PS - I'm no expert, you might want to wait for someone who is

scottkeene · 13 December 2016 at 3:11PM

Hello,

Thanks for the reply. Nearly, except its a proper Lease car. So tax, MOT, service etc is all covered under the company car lease agreement.

Same apply?

singhini · 13 December 2016 at 3:27PM

I'm not sure, I can't see why your being paid 10p per mile if its a company car which you don't pay anything for.

Infact I would think its the opposite; that the car would be a benefit in kind and appear on your PAYE tax code (so you pay company car tax). Also you would be paying your company for using the car at evenings ad weekends i.e. private mileage.

You seem to have access to a car that belongs to your company and you pay none of the running costs but you are wanting payment for driving it.

Best to wait for a more knowledgeable person than me, sorry

singhini · 13 December 2016 at 3:50PM

Ah could there be a third way I haven't thought about. Could your company be paying you an allowance into your salary which automatically gets taken back out to pay for a car which is being leased (in your name). Thus the car is not a company car but a car that you are leasing (the lease also covers insurance, servicing, road tax etc.....).

Now in theory you are driving a car you are leasing and nothing to do with the company and your employer pays you 10p mile (the employer may have helped you set up the car lease but on paper its nothing to do with them as its a paper exercise, the lease is in your name). Thus you would not have company car tax to pay on your PAYE coding.

So in theory you might be able to do what I said in post #2

But it could get more complicated depending on who pays for the fuel?

If you pay for the fuel then that's fine. if your company pays for the fuel then I'm guessing you would take that off the amount being claimed. So in post #2 where I have put £5,150 you might have to take off cost of fuel (lets say fuel cost you £3,000 all year), then you would get 20% tax relief on £5,150 - £3,000 = £2,150 x 20% = £430

I'm really not sure, don't rely on me

Have you spoken to your fleet manager or the leasing company about what you can do?

Caz3121 · 13 December 2016 at 4:05PM

scottkeene wrote: »

can I claim the tax relief as per the gov.uk website which it refers to.

the tax relief available to claim refers to you using your own personal car. If a company car whether you have a BIK deduction there is no additional to be claimed as the extra is for wear and tear, insurance, tyres etc for your personally owned vehicle which do not apply if you have a company car

You need to clarify if this is a company car or a personal car

Darksparkle · 13 December 2016 at 4:50PM

Who is paying for the fuel?

These are the advisery fuel rates for company cars - https://www.gov.uk/government/publications/advisory-fuel-rates/advisory-fuel-rates-from-1-march-2016

lisa110rry · 13 December 2016 at 5:21PM

No, there was a new set of rates published 1 December 2016, although the old rates can be allowed to continue for one month.

scottkeene · 13 December 2016 at 5:26PM

Hi,

Its classed as a company car. I get an allowance in my benefits which I use to pay (before PAYE and NI) for a lease car through the company scheme (so salary sacrifice). All costs are covered except day to day running (fuel etc). I pay for fuel, but claim expenses for work related business trips (commute to client site) when the mileage is over my normal workday commute to my home office.

I then claim back once or twice a month that expense at the rate of 9p a mile (at the current time).

Does that clarify?

MichelleUK · 13 December 2016 at 5:36PM

Deleted double post.

MichelleUK · 13 December 2016 at 5:38PM

scottkeene wrote: »

Hi,

Its classed as a company car. I get an allowance in my benefits which I use to pay (before PAYE and NI) for a lease car through the company scheme (so salary sacrifice). All costs are covered except day to day running (fuel etc). I pay for fuel, but claim expenses for work related business trips (commute to client site) when the mileage is over my normal workday commute to my home office.

I then claim back once or twice a month that expense at the rate of 9p a mile (at the current time).

Does that clarify?

See the link that Darksparkle has given, they are fuel only rates on a company provided car (which is what your salary sacrifice car is), so it looks as if you probably have nothing to claim.

Fuel Tax Relief

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