Mileage expense rates

[Blown2CV]

Bit of a tedious one this maybe. I get a flex benefits package which can be offset against a variety of benefits, including a car. I don't take any of them, so I just receive the cash and pay the tax on it. Our company expenses policy states that if anyone either gets a car allowance or is entitled to a car, they should be claiming mileage at say 20ppm. Does this apply to me or not. It's not specifically a car allowance, and I don't equally know if a salary sacrifice car option qualifies as company car entitlement...

[edc]

Blown2CV said:

Bit of a tedious one this maybe. I get a flex benefits package which can be offset against a variety of benefits, including a car. I don't take any of them, so I just receive the cash and pay the tax on it. Our company expenses policy states that if anyone either gets a car allowance or is entitled to a car, they should be claiming mileage at say 20ppm. Does this apply to me or not. It's not specifically a car allowance, and I don't equally know if a salary sacrifice car option qualifies as company car entitlement...

This is an internal policy question which you will have to ask your own company about.

[Sheepshanks]

Claim a fee hundred miles and if no-one says anything then gradually increase it.

[Kermit power]

Sheepshanks said:

Claim a fee hundred miles and if no-one says anything then gradually increase it.

Depending on which company you work for, that could be an outstanding way of getting yourself fired! I'm sure we're not the only large company who runs various analytics algorithms against expense claims looking for just such anomalies. Nobody will say anything until the computer does, at which point, you're already seriously in the st.

[Sheepshanks]

Kermit power said:

Depending on which company you work for, that could be an outstanding way of getting yourself fired! I'm sure we're not the only large company who runs various analytics algorithms against expense claims looking for just such anomalies. Nobody will say anything until the computer does, at which point, you're already seriously in the st.

It'll be fine - he's following the policy.

[Kermit power]

Sheepshanks said:

It'll be fine - he's following the policy.

Ah, fair enough.

I've given up on our policy for company car drivers. They pay HMRC's defined rates, and I don't believe there's a single vehicle in the country that could do the MPG required to break even!

I now have a policy of train/taxi everywhere even remotely possible. It might cost more, but why should I be subsidising the business?

[Blown2CV]

i should qualify, i have a privately leased car. The company i currently work for has an expenses system where there is only one rate for private cars used for company mileage and it's 45ppm. We are all being TUPEd into a bigger company where their policy has the above referenced position. I have an issue with the notion this idea of flexible benefits really. It's just a pot of cash, which is great and everything, but at what point does that become a "company car equivalent"? I could argue my house is the 'equivalent' of a ferrari but it isn't. Money is the equivalent of anything you might buy with it!!

[Sheepshanks]

Kermit power said:

I've given up on our policy for company car drivers. They pay HMRC's defined rates, and I don't believe there's a single vehicle in the country that could do the MPG required to break even!

Off the top of my head you'd have to be nudging 40MPG in a typical petrol and 50MPG in a diesel. Both are possible. OK, it's tight - but it's designed to be.

The rate changes every quarter to keep aligned with fuel prices move.

[Sheepshanks]

swerni said:

eh?
at 45p a mile for the first 10,000, even on 20mpg, thats £9 a mile.
Your car must break down one hell of a lot if you can't break even.

That's not for company cars.

[Kermit power]

swerni said:

Kermit power said:

Sheepshanks said:

It'll be fine - he's following the policy.

Ah, fair enough.

I've given up on our policy for company car drivers. They pay HMRC's defined rates, and I don't believe there's a single vehicle in the country that could do the MPG required to break even!

I now have a policy of train/taxi everywhere even remotely possible. It might cost more, but why should I be subsidising the business?

eh?
at 45p a mile for the first 10,000, even on 20mpg, thats £9 a mile.
Your car must break down one hell of a lot if you can't break even.

As Sheepshanks said, not for company cars.

On a 2 litre diesel, my last claim was at 10p per mile. At £1.18 per litre, you need to average something like 54 MPG to break even.

OK, if you can drive everywhere at 60 without having to slow down and accelerate, but chuck in a bit of urban driving, or hit a traffic jam and you've got no chance of hitting it!

I've got a Mercedes C350e coming in April, so it'll be interesting to see if I can cover the costs in that.

[Blown2CV]

if we were getting paid out at 45ppm across the board then there would be no need for this thread!

[Sheepshanks]

Kermit power said:

On a 2 litre diesel, my last claim was at 10p per mile. At £1.18 per litre, you need to average something like 54 MPG to break even.

It's 11p now.

[Sheepshanks]

Blown2CV said:

if we were getting paid out at 45ppm across the board then there would be no need for this thread!

You said above you did get 45p per mile. Although in your OP you suggested 20p.

I'm baffled by your question/point, to be honest. Are you driving on business now, but not claiming?

[Kermit power]

swerni said:

Ahh got you, thought they were paying you HMRC rates.
You're right 10 per mile is st

It's st indeed, but that is HMRC rates!!

This is on a fully funded company car. I've got no costs for tyres, servicing or insurance, so if I had to average, say, 35-40mpg in a diesel to hit it, that would be perfectly reasonable, as it is just about recovering fuel costs, and the swings of some completely clear motorway journeys would be balanced out by the roundabouts of the occasional traffic jam.

The reason it's so st is that HMRC base the rate on the average manufacturers' stated MPG figures for that engine band, so they are woefully below reality in the first place.

Then, if you've got a 2 litre, it's made worse by the fact that in reality you'll have something like 1,996cc, never, in my experience, 2,004cc. This means you're lumped in with the average claimed consumption figure for all vehicles up to 2 litres, rather than a narrower band for more realistic figures.

The Merc will also be 1,996cc, but at least I'll get up to 19 "free" miles to help balance the numbers, and as I'm now selling to hospitals and local authorities, many of whom have charging points in their car parks to charge up for the return journey, who knows, by having a PHEV, I might actually be able to break even on the mileage rates HMRC sets for bog standard petrol engines!

[Blown2CV]

Sheepshanks said:

Blown2CV said:

if we were getting paid out at 45ppm across the board then there would be no need for this thread!

You said above you did get 45p per mile. Although in your OP you suggested 20p.

I'm baffled by your question/point, to be honest. Are you driving on business now, but not claiming?

you must have skim read it. I get 45ppm. My company is merging into a company with a policy that states they get 20ppm (I think, certainly a reduced mileage-only rate) if the employee is entitled to a company car. I was just questioning the meaning of entitlement. It's sounding like I am going to have to go with the lower rate unfortunately, the more i hear about it.

[ChrisNic]

HMRC rates are interesting, with respect to fuel alone it's more cost effective to run my new Focus RS instead of my Leon FR184. For long distance mainly motorway trips I've never had any problems achieving the required mpg to break even, local journeys ruin that though.

[Blown2CV]

the mileage rates aren't exactly break even for me as I drive a 4L twin turbo, but I'd still rather get 45ppm than 20ppm!!

[Blown2CV]

swerni said:

I would have thought the bigger question would be, can they make that kind of change to your contract?

well as per terms of TUPE they can't change terms, but this is a policy matter not a terms matter. Mileage rates are not in the employment contract, and neither is entitlement to a car tbh.

[hantsxlg]

Remember that if you only get 20ppm you can claim tax relief back on the difference to 45ppm. So.40% (or 45... Assume as ph.demographics 20% not relevant) of 25p can be claimed from hmrc at year end. Or some companies are clever enough to process the tax adjustmentl via your payslip each month...