Self-assessment help please

[WAVman]

Morning all, just a little advice please.

I have always been PAYE with company cars all tax paid at source.

In May I started a new job with a car allowance and a employer scheme for personal lease cars. I have an E220cdi AMG Line for c£340pm on an 18m contract which is a great deal I think. I also pay an amount based on my estimated mileage being over the contract mileage which is reviewed every 6m and amended if necessary with any surplus being returned to me. The idea behind this is to avoid any surprises at the end due to excess miles.

I know I am able to claim my business miles against tax by submitting self assessment. Can I do this on-line as I go along or do I need to wait until the end of this tax year to do this? I have registered for self assessment and got the code to make the system live for me, but don't want to confuse the job if I don't submit anything yet.

Thanks in advance.

Edited by WAVman on Monday 23 September 12:20

[bogie]

You can wait until year end or you can make a guess at your monthly mileage and adjust now. Say you do 1000 miles a month on business (12k a year)

You get tax relief on first 10k miles at .45p and .25p after that
10000 miles @.45p = £4500
2000 miles @ .25p another £500

so you have £5k of business expenses for the year to tell the tax man about. You can tell them online in the website in the tax code section. Just do the calculations and tell them an estimate of business expenses and they adjust your tax code accordingly within a few days.

I tend to under estimate, I prefer to know that I have a bonus due every April when I promptly do my tax return for the year to claim back tax....better than worrying how much you owe them and a motivator for you to stay on top of your return

[WAVman]

Thanks mate, that's kind of what I thought.

I think I will leave until the end of the tax year and get a good size rebate, I will be doing c30k miles so it should be worth having.

Edited by WAVman on Monday 23 September 17:13

Edited by WAVman on Monday 23 September 17:13

[mfmman]

bogie said:

You get tax relief on first 10k miles at .45p and .25p after that
10000 miles @.45p = £4500
2000 miles @ .25p another £500

Don't forget you need to deduct however much your employer pays you per mile for business use of a private car from those figures

[WAVman]

mfmman said:

bogie said:

You get tax relief on first 10k miles at .45p and .25p after that
10000 miles @.45p = £4500
2000 miles @ .25p another £500

Don't forget you need to deduct however much your employer pays you per mile for business use of a private car from those figures

They don't pay me anything, I have a fuel card for all mileage, and then they charge me back for private mileage which works fine.

I think I'm ok to claim 100% of business miles.

[bogie]

WAVman said:

mfmman said:

bogie said:

You get tax relief on first 10k miles at .45p and .25p after that
10000 miles @.45p = £4500
2000 miles @ .25p another £500

Don't forget you need to deduct however much your employer pays you per mile for business use of a private car from those figures

They don't pay me anything, I have a fuel card for all mileage, and then they charge me back for private mileage which works fine.

I think I'm ok to claim 100% of business miles.

I had a similar deal for 14 years at a previous employer. Works great if you have a private car with fuel card. The cash value of fuel benefit showed up as a benefit on my P11D as additional earnings you are taxed on then you claim back the tax relief on expense at.45p.

[2 sMoKiN bArReLs]

WAVman said:

mfmman said:

bogie said:

You get tax relief on first 10k miles at .45p and .25p after that
10000 miles @.45p = £4500
2000 miles @ .25p another £500

Don't forget you need to deduct however much your employer pays you per mile for business use of a private car from those figures

They don't pay me anything, I have a fuel card for all mileage, and then they charge me back for private mileage which works fine.

I think I'm ok to claim 100% of business miles.

So your company pays the fuel for your business miles?

I think the rates quoted above are for when you stump up for everything. Eric will be along shortly to put us all straight

[bogie]

The mileage rates are the max tax free rates for using a private car use for business. It does not matter if you have a fuel card, car allowance whatever (both are just extra cash on your salary). An employer could choose to pay you .80p a mile but you would be taxed on the 0.55p over the .45p HMRC mileage rate just as if it were regular income.

Essentially this is what happens If you employer gives you a fuel card to go with a private car,its just a cash benefit and gets added onto your taxable earnings. You still have the tax relief to claim on the business mileage expense .

Personally I always find a fuel card and car allowance a nice combination for flexibility, much better than being tied into a company car and paying tax based on Co2 emissions, particularly with a decent cash allowance.

[Heres Johnny]

bogie said:

The mileage rates are the max tax free rates for using a private car use for business. It does not matter if you have a fuel card, car allowance whatever (both are just extra cash on your salary). An employer could choose to pay you .80p a mile but you would be taxed on the 0.55p over the .45p HMRC mileage rate just as if it were regular income.

Essentially this is what happens If you employer gives you a fuel card to go with a private car,its just a cash benefit and gets added onto your taxable earnings. You still have the tax relief to claim on the business mileage expense .

Personally I always find a fuel card and car allowance a nice combination for flexibility, much better than being tied into a company car and paying tax based on Co2 emissions, particularly with a decent cash allowance.

The OP is being charged back for personal mileage so there’s no benefit

In effect your employer is paying the true cost of fuel for business and not one of the approved rates, paying actual fuel cost is acceptable as any justifiable receipted expense can be claimed. You could take the view you’re still entitled to the 45p but deduct the mileage rate for fuel for your class of car, and claim that back as additional tax code.

[mfmman]

As others have posted, if submitting the return correctly then you must deduct any amount contributed by the employer to the cost of running a private car from the AMAP rates shown.

There are far too many permutations to list them all here but seemingly closest to the OP from his/her description would be; Employer pays for all fuel then contra charges OP for private use using HMRC per mile rates for engine type/size. Employer making this charge means no fuel benefit to pay.

In terms of allowance available to the employee. Since the figures of fuel cost are now available (sum spent on card - private use contribution) it makes sense that this figure can be deducted from the allowable AMAP rates and the employee can claim a rebate on the remainder

Quick example

Fuel card spend of £3,140 total for 25000 miles in tax year. Employee records 5000 private miles and employer charges applicable HMRC rate of 11p so £550.

Business use fuel contribution by employer is now £2590, employee has done 20000 business miles (AMAP rates, 10k at 45p and 10k at 25p = £7000) so allowable expense would be £7000 - £2590 = £4410 at appropriate rate of tax. i.e 40% = £1,764)

[oop north]

For a few months I had a job with a fuel card and used my own car. Lots of business miles - the calculation was business miles x 40p (now 45p) is deduction allowed BUT only if employer pays zero to cost - I had to deduct from that whatever the employer paid for fuel for business miles. For me It wasn’t done at fixed pence per mile but actual cost. So if business miles were two thirds of total mileage paid via fuel card, the 45p per mile x bus miles figure has deducted that proportion

So I did 10k business miles and 5k private. Fuel card total cost say £2250 of which £750 private and £1500 business. Current calc would be 45p x 10k = £4500 expense but then deduct £1500 business fuel cost met by employer. So business expense would be £3000 on which you get tax relief at 20% / 40%