Anyone else heard about a rate rise in mileage allowance

[mmm-five]

Anyone else heard about this? Looking at the difference in the amounts they want receipts for, they've all risen by 20%.

This is the email from my payroll processing company...

email said:

Dear mmm-five,

As a result of the rise in fuel prices HMRC have revised the petrol element of the mileage allowance you receive as from the 1st July 2008. There is a knock on effect of this, in that there is an increase in the value of valid VAT receipts required to support each 100 business miles claimed.

As from the 1st July 2008 all expenses claims entered on the system (regardless of when the mileage relates to) you will need to submit receipts in line with the new rates. So please ensure that your mileage claims are up to date between now and the 1st July.

The Expense Policy has been amended to reflect the new rates. On the 1st July 2008 you will need to visit your portal to view your new rates and re-accept the Expense Policy. There are NO other changes to the Expense Policy.

Once again the change will apply for all mileage entered from 1st July 2008. This should not represent a problem for you as we have all been paying at above these levels for some time with the cost of petrol over the last few months.

Thanks for your help in making this a smooth change of rates as introduced by HMRC.

http://www.hmrc.gov.uk/cars/advisory_fuel_current.htm

Edited by mmm-five on Monday 16th June 20:22

[Brown and Boris]

Looks like that is just the fuel element (thus the VAT wrangling). I haven't heard anything about the 'full fat' rate of 40p PM being upped.

I think my fuel element was 9p so the inferenmce is that the full rate will rise by those few pence????????

[Brown and Boris]

Nope



http://www.hmrc.gov.uk/rates/travel.htm still 40p, whereas the logic in that? If you have a company car the fuel rates have gone up but for those using their own car it has stayed the same (for years)

[mmm-five]

That's what I thought. Couldn't find any info on requiring higher receipts either.

I've asked the agency to send me a link to the relevant HMRC notice for clarification, but two requests have gone now and they seem to be answering part of my question but not supplying a link.

They're saying that the wording 'the petrol element' means the fuel receipt? I think they've sent this email out before getting it proof-read by someone who was sober and don't want to admit a cock-up.

[Chrisgr31]

I think this relates to the rate that those who recive car allowance get. Car allowance i meant to cover deprecitaion, servicing, insurance etc. So the mileage rate relates to fuel only. On this basis it is much easier to see how this figure has changed with petrol prices!

[Adam T]

We have increased our personal car users allowance to 43p per mile, the additional 3p being a BIK with records being kept.

Every little helps..

[Eric Mc]

Governments increase their tax take merely by allowing inflation to erode the value of allowances and thresholds. The technique is called "inflation creep" and is a well know tool.

[thekirbyfake]

mmm-five said:

That's what I thought. Couldn't find any info on requiring higher receipts either.

I've asked the agency to send me a link to the relevant HMRC notice for clarification, but two requests have gone now and they seem to be answering part of my question but not supplying a link.

They're saying that the wording 'the petrol element' means the fuel receipt? I think they've sent this email out before getting it proof-read by someone who was sober and don't want to admit a cock-up.

Did you ever get an answer to your question?

I have also been asked for VAT fuel receipts when claiming mileage (own car for business use) but I have no idea how the receipt will be relevant.

How can they (my employer or HMRC) know how much fuel (and therefore VAT) I've used to drive 100 miles?

[Adam T]

Ive not been asked to provide receipts for my personal car usage for work etc.

[Plotloss]

thekirbyfake said:

How can they (my employer or HMRC) know how much fuel (and therefore VAT) I've used to drive 100 miles?

Its so they can check that the VAT claimed doesnt exceed the total VAT paid, if you see what I mean.

Receipts prove the maximum that it could possibly be.

[thekirbyfake]

Plotloss said:

Receipts prove the maximum that it could possibly be.

How?

I could put in receipts for £200 worth of fuel for a 100 mile journey.

Without knowing the mpg for the journey (i.e. how much VAT was "used") how do they decide how much to claim?

Unless they simply use 17.5% of the advisory fuel rates from the OP?

i.e. 21p/mile for my car therefore £3.675 for a 100 mile journey.