Claiming back business miles.. Layman speak

[oop north]

mike9009 said:

Hi

I am recently getting into these realms. I am a higher rate tax payer. My new company require us to use our personal cars for business use (not too many miles, maybe 2000 per annum)

I put in an expenses form and get reimbursed 45ppm. Do I need to do anything for the taxman? Reading the above, I suspect I don't. If I do is there a simple guide somewhere?

Thanks

Sorry for the hijack!

Mike

You shouldn't need to do anything - the expenses you get are tax-free (technically, [i think but Eric is more reliable than me ] if your employer doesn't have the appropriate dispensation it should go on a P11D as taxable benefit but then you would just claim a deduction of the same amount - so I know accountants who say you can just ignore it with HMRC not being bothered as there's no loss to them)

[mfmman]

Pheo said:

pmanson said:

Say you did 10,000 miles. You claim via work would be .25p x 10k = £2,500. What the government will allow you to claim is £4,500 (45ppm). On the £2k difference you can claim the tax back on this (£400/£800 dependent on tax level).

Claimable rates drop once you hit a certain threshold but it's pretty straightforward to do it. From memory as long as the claim is less than £2,500 you can do this without doing a tax return.

Excellent - I've probably got a couple of thousand miles easily owed to me (which should balance out the underpayment cos my company forgot to tell them about the company car for 6 months!!!)

I'd say not

If it truly is a company car, they bought it - insured it - pay all running costs outside fuel, then AMAP rates don't apply, it's not your car. I assume your contribution is a payment from net salary to enhance the car offered not a contribution to providing the initial car (i.e you are not obligated to do this). AMAP rates only apply to using your own car on business (not commuting) use

[Eric Mc]

The 45p/25p rates apply to PERSONAL cars - not Company Cars.

If you HAVE to personally pay for the fuel you use on work related journeys in a company car, you CAN make a tax relief claim for mileage but the rates are much lower - more like 11p per mile.

[markiii]

If your using your car for business use you need business insurance, do you?

Bet the mileage claim to hmrc doesn't cover that extra cost

[markiii]

If your using your car for business use you need business insurance, do you?

Bet the mileage claim to hmrc doesn't cover that extra cost

[oyster]

OP, do yourself a favour and talk to your employer.

I truly cannot believe they expect you to pay for their business travel out of your own pocket.

[mfmman]

markiii said:

If your using your car for business use you need business insurance, do you?

Bet the mileage claim to hmrc doesn't cover that extra cost

Whilst clearly it depends on the individual, B1 which sounds like the types of use being discussed here added next to nothing for the years I did it (less than 10% I think)

[mike9009]

mfmman said:

Whilst clearly it depends on the individual, B1 which sounds like the types of use being discussed here added next to nothing for the years I did it (less than 10% I think)

Business insurance actually worked out cheaper for me.

Limited to 2000 per year.

I can never work out insurance premiums though???

Mike

[Teddye4687]

Thanks for your feedback all

[Foliage]

Kind of off topic, is it possible if for example you cycle for (like a post man etc) work to claim the tax back on food as a fuel?

[andy-xr]

Foliage said:

Kind of off topic, is it possible if for example you cycle for (like a post man etc) work to claim the tax back on food as a fuel?

Some places actually do a 20ppm bike reclaim

[Foliage]

andy-xr said:

Foliage said:

Kind of off topic, is it possible if for example you cycle for (like a post man etc) work to claim the tax back on food as a fuel?

Some places actually do a 20ppm bike reclaim

Yeah id assumed that if you get a job that requires you to ride a bike it would be assumed to be in the salary, but that's interesting. I was wondering more how the tax man sees it.

[Eric Mc]

There is a Bike to Work scheme.

http://www.bike2workscheme.co.uk/?utm_source=googl...

Essentially, an employer can buy a bike for you and you won't be taxed under the Benefit in Kind rules - as long as you and the employer jumps through the hoops of the scheme.

If you use your own personal bicycle to carry out work related journeys, you can claim 20p per mile. There is no upper 10,000 mile limit either.

The normal commute to and from work cannot be claimed.

[TwigtheWonderkid]

Eric Mc said:

If your employer does not pay you any mileage when you use your personal car for work related travel, then you can make the 45p per mile claim from HMRC.

So, if you drove 2,000 miles in a tax year as part of your employment, you could make a tax relief claim of £900.00(2,000 miles @ 45p)

However, HMRC will not refund you £900.00. They will deduct the £900.00 from your taxable income for the year and refund to you the tax saving you are entitled to. As you are a basic rate taxpayer, the amount of tax refund you would get would be £180.00 i.e. £900.00 @ 20%. If you were a higher rate taxpayer the tax refund would be £360.00.

There are a couple of things you need to be aware of

i) the 45p per mile rate only covers the first 10,000 business miles. You can only claim 25p per mile for business miles above 10,000.

ii) travel to and from your normal place of work (the "commute") is not claimable.

Pretty much a perfect explanation of the rules.

Your employer does seem to be getting away with murder though. Paying you nothing, and you have to buy fuel, pay for wear and tear, insure the car for business use, to use the car for their business!!! I've never heard anything like that and I certainly wouldn't stand for it.

[Eric Mc]

In a world of Zero Hour Contracts - then Zero Mileage Rates are not unexpected.