Business Mileage
Discussion
Just a quick question as I've never seen this before.
New company, not paid a car allowance but expected to use own car for business use.
I submitted a mileage claim but had to include what my daily return commute mileage was to the office. The reason for this is that they subtract this daily total off the business miles you do.
They want the full postcodes each time so they can check so, if I go from home to a supplier it's a 116 mile round trip, however they will take 36 miles off of that as it's the miles I would have done to the office and back.
Never in 30 odd years have I ever seen this before, and no, wasn't mentioned in any form as part of the expenses policy.
Does anyone else have this?
Cheers,
M
New company, not paid a car allowance but expected to use own car for business use.
I submitted a mileage claim but had to include what my daily return commute mileage was to the office. The reason for this is that they subtract this daily total off the business miles you do.
They want the full postcodes each time so they can check so, if I go from home to a supplier it's a 116 mile round trip, however they will take 36 miles off of that as it's the miles I would have done to the office and back.
Never in 30 odd years have I ever seen this before, and no, wasn't mentioned in any form as part of the expenses policy.
Does anyone else have this?
Cheers,
M
I've worked for 2 IT Consultancies who had the following policy: If you're using your personal car for business use (i.e. a client visit) we'll cover your mileage either from your house to the client, or from our office to the client, whichever is shortest.
Sounds like your policy is pretty similar - basically saying "if we'd not sent you to the client site, you'd have to come to the office like everyone else, and we're not going to cover your mileage for that journey".
Sounds like your policy is pretty similar - basically saying "if we'd not sent you to the client site, you'd have to come to the office like everyone else, and we're not going to cover your mileage for that journey".
Fairly normal.
You'll be able to claim a tax deduction on the difference if you want to though, as HMRC class the whole journey as business mileage.
Example...
You do 5k miles over the year, so HMRC will allow you 5000x45p = £2,250.
But if your company has deducted 1k miles and only paid you £1,800 you can claim a tax deduction of £450, which will be between £90 and ~£200 in your pocket.
If your company pays less than 45p per mile then the difference is more.
You'll be able to claim a tax deduction on the difference if you want to though, as HMRC class the whole journey as business mileage.
Example...
You do 5k miles over the year, so HMRC will allow you 5000x45p = £2,250.
But if your company has deducted 1k miles and only paid you £1,800 you can claim a tax deduction of £450, which will be between £90 and ~£200 in your pocket.
If your company pays less than 45p per mile then the difference is more.
Heartworm said:
It's tax rules that enforce this, pain in the arse when your drive to the office is pretty long!
I wasn't aware of tax rules that say they can't pay you for the whole journey. They don't have to deduct the normal commute mileage from a business trip starting and finishing at home. But they can choose to. TwigtheWonderkid said:
I wasn't aware of tax rules that say they can't pay you for the whole journey. They don't have to deduct the normal commute mileage from a business trip starting and finishing at home. But they can choose to.
In the distant past it used to be called the "Triangle Rule" and was a HMRC (or, at the time, Inland Revenue) rule. Think it was pre-millennium that they changed the guidance, but a lot of employers still consider that it's only fair to pay the "extra" miles not your normal ones - at least in my experience.It's pretty disgraceful that an employer does not recompense an employee directly for using their own car for job related travel.
You can, of course, make a claim from HMRC for a mileage allowance based on the work related miles you do in teh year, but t6hat is only refunded to you at your top rate of tax.
So, if you had 8,000 business related miles, you would make a claim to HMRC of 8,000 @45p = £3,600.
However, HMRC will not refund you £3,600 but £3,600 at whatever tax rate you pay. If you are a basic rate taxpayer, you get £720 back. If a 40% taxpayer you get £1,440 and if a 45% taxpayer £1,620.
If your employer had reimbursed you directly at 45p per mile, you would have got back £3,600 TAX FREE.
You can, of course, make a claim from HMRC for a mileage allowance based on the work related miles you do in teh year, but t6hat is only refunded to you at your top rate of tax.
So, if you had 8,000 business related miles, you would make a claim to HMRC of 8,000 @45p = £3,600.
However, HMRC will not refund you £3,600 but £3,600 at whatever tax rate you pay. If you are a basic rate taxpayer, you get £720 back. If a 40% taxpayer you get £1,440 and if a 45% taxpayer £1,620.
If your employer had reimbursed you directly at 45p per mile, you would have got back £3,600 TAX FREE.
When I worked for Local Government this was a policy. Pissed me off, so I took a policy that if they were being to the letter so was I, and if I was going from home my working day would start at 9AM, when I left home....
This was particularly where I was going somewhere nearer home than the office, so it would actually have saved them money.
This was particularly where I was going somewhere nearer home than the office, so it would actually have saved them money.
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