Tax question regarding mileage reimbursement
Tax question regarding mileage reimbursement
Author
Discussion

sawman

Original Poster:

5,170 posts

260 months

Wednesday 4th July 2012
quotequote all
My employers had initiated a policy to revise how they reimburse business mileage. Essentially, the current 47p per mile will drop to 23p per mile. I see that the HMRC suggest that 40p per mile is the tax threshold for mileage reimbursement. Does this mean that when I move to the 23p per mile I could claim the difference against my tax liability. if so how would I do this?

Alternatively I could take a lease car provided by my employer and be paid 48p per mile.....

cuprabob

19,758 posts

244 months

Wednesday 4th July 2012
quotequote all
I think it's 45p now from HMRC


sawman

Original Poster:

5,170 posts

260 months

Wednesday 4th July 2012
quotequote all
cuprabob said:
I think it's 45p now from HMRC
ooh, better still, I must have seen old figures

marshalla

15,902 posts

231 months

Wednesday 4th July 2012
quotequote all
cuprabob said:
I think it's 45p now from HMRC
For the first 10000 miles ISTR.

Marky Boy

164 posts

262 months

Wednesday 4th July 2012
quotequote all
It's 45p for the first 10'000 and 25p thereafter. The difference if lower can be deducted from your tax liability. Or if you receive higher its a taxable benefit.

HTH

sawman

Original Poster:

5,170 posts

260 months

Wednesday 4th July 2012
quotequote all
thanks, so presumably I can just keep log of miles - it would be less than 10k - and put the info on my tax return at year end - under business expenses?

Marky Boy

164 posts

262 months

Wednesday 4th July 2012
quotequote all
Yeah, you'd just claim it in your self assessment. I'm not too sure of where you'd put it as I don't usually do them myself. Also be aware there will be other taxable benefits if they provide you with a car and fuel, and these could be significant i.e £ks. Best speak with your accounts department, or an actual accountant, to decide the most tax efficient solution for you.

sawman

Original Poster:

5,170 posts

260 months

Wednesday 4th July 2012
quotequote all
Marky Boy said:
Yeah, you'd just claim it in your self assessment. I'm not too sure of where you'd put it as I don't usually do them myself. Also be aware there will be other taxable benefits if they provide you with a car and fuel, and these could be significant i.e £ks. Best speak with your accounts department, or an actual accountant, to decide the most tax efficient solution for you.
Cheers,

I don't think there are any other taxable benefits, the choice is either use my own car, insure for business use and get paid 23p per mile,
or pay (as a salary sacrifice, thus attracting BIK tax) for a lease car from my employer which would be fully maintained and insured and get the 48p per mile allowance - which as I don't need a new car seems a bit of a waste!

sumo69

2,164 posts

250 months

Thursday 5th July 2012
quotequote all
You should be aware that HMRC don't refund the remaining 22p of the 45p - you get tax relief on it.

If you pay tax at the basic rate this is worth 4.4p per mile claimed or if you are at higher rate then 8.8p per mile claimed.

All in all, your employer is tight!

Are you sure they can change this policy without your agreement as expense procedures may form part of your employment contract?

David

sawman

Original Poster:

5,170 posts

260 months

Thursday 5th July 2012
quotequote all
sumo69 said:
You should be aware that HMRC don't refund the remaining 22p of the 45p - you get tax relief on it.

If you pay tax at the basic rate this is worth 4.4p per mile claimed or if you are at higher rate then 8.8p per mile claimed.

All in all, your employer is tight!

Are you sure they can change this policy without your agreement as expense procedures may form part of your employment contract?

David
Thanks for the clarification david,

Yes my employer is tight - its the NHS. it seems they can change this policy without agreement, although I understand that unison are challenging the move.
Interestingly the trust runs fleet solutions, a profit making lease car division