Employer Deducting Commuting Mileage from Business Travel
Discussion
Anyone have any experience of this, the HMRC guidance is not definitive as far as I can see...
example: Employee A lives 80 miles from their office, Employee B lives 10 miles in the opposite direction, so 90 miles from Employee A
Meeting is being held at a off site location which is 20 miles in the opposite of travel to work for Employee A and 110 miles for employee B with the first and last 10 miles being past the office.
Travel policy states; only mileage additional to commuting mileage from home to the primary work location (named in the contract of employment or in a subsequent relocation notification) can be claimed:
Employee A claims nothing
Employee B claims 200 miles
Now this would have all been logical before covid, however Employee A is working 80% from home and they and the employer are happy for them to do so, Employee B is 40% home based.
Given this clearly creates a dual work locations (even if an informal arrangement) in HMRC eyes for both employees.
Employee A now wants to claim 40 miles as commuting can be 0 or 160 miles in a day and employee B wants to claim the full 220 miles on the same principle.
Any thoughts?
My view is that they can claim the tax relief via self assessment, on the whole mileage for employee A and the unclaimed 20 miles for employee B and the company travel policy is maintained.
example: Employee A lives 80 miles from their office, Employee B lives 10 miles in the opposite direction, so 90 miles from Employee A
Meeting is being held at a off site location which is 20 miles in the opposite of travel to work for Employee A and 110 miles for employee B with the first and last 10 miles being past the office.
Travel policy states; only mileage additional to commuting mileage from home to the primary work location (named in the contract of employment or in a subsequent relocation notification) can be claimed:
Employee A claims nothing
Employee B claims 200 miles
Now this would have all been logical before covid, however Employee A is working 80% from home and they and the employer are happy for them to do so, Employee B is 40% home based.
Given this clearly creates a dual work locations (even if an informal arrangement) in HMRC eyes for both employees.
Employee A now wants to claim 40 miles as commuting can be 0 or 160 miles in a day and employee B wants to claim the full 220 miles on the same principle.
Any thoughts?
My view is that they can claim the tax relief via self assessment, on the whole mileage for employee A and the unclaimed 20 miles for employee B and the company travel policy is maintained.
Edited by TWODs on Wednesday 3rd April 14:39
DickP said:
Deducting commuting mileage from business travel is poor form in my opinion and in my sector suggests penny pinching of the employer.
I mean, maybe I'm doing it wrong, but I'm my own boss and I use the office postcode as my start and end point when doing my mileage expenses. OK employee A previously would have only been able to claim for business travel unless it was in excess of 80 miles each way, now they want to claim for any mileage that is not specifically to the contractually named office. As they say by allowing them to regularly work from home, even on an informal basis we have created a dual work location and so their commute on a business travel day could have been 0 miles and this would not be charged as a taxable benefit by HMRC.
The travel policy is inflexible as it is the parent companies, and my view as the employer is, I agree, the 80miles would not be classed as a taxable benefit (even before they worked a lot from from home), and they could claim the tax relief on the mileage via self-assessment, but that doesn't change the company travel policy.
So as they earn well in to 6 figures, they'd get relief at 55% of the 45p rate for the business travel mileage incurred between 0 & 80 miles.
The other employee is ineffect in exactly the same position, but they essentially get to claim for nearly all business travel in full already due to proximity to the office, however they could also claim for the tax relief for the small additional mileage if they can be bothered.
By the way I agree it is as stingy as you can get, but it's not something I get a say on.
The travel policy is inflexible as it is the parent companies, and my view as the employer is, I agree, the 80miles would not be classed as a taxable benefit (even before they worked a lot from from home), and they could claim the tax relief on the mileage via self-assessment, but that doesn't change the company travel policy.
So as they earn well in to 6 figures, they'd get relief at 55% of the 45p rate for the business travel mileage incurred between 0 & 80 miles.
The other employee is ineffect in exactly the same position, but they essentially get to claim for nearly all business travel in full already due to proximity to the office, however they could also claim for the tax relief for the small additional mileage if they can be bothered.
By the way I agree it is as stingy as you can get, but it's not something I get a say on.
PistonBroker said:
DickP said:
Deducting commuting mileage from business travel is poor form in my opinion and in my sector suggests penny pinching of the employer.
I mean, maybe I'm doing it wrong, but I'm my own boss and I use the office postcode as my start and end point when doing my mileage expenses. TWODs said:
Employee A now wants to claim 40 miles as commuting can be 0 or 160 miles in a day and employee B wants to claim the full 220 miles on the same principle.
I'm fairly sure that ^^^ is correct. As they are mainly working from home HMRC would regard them as having two temporary workplaces therefore they're entitled to claim mileage starting from home.Business mileage is that travelled for business less the mileage that you would normally do to your usual workplace.
It doesn't matter which direction you go; if your daily commute to your usual workplace is 10 miles, then you should deduct 20 miles (10 each way) from any business mileage claim.
It doesn't matter which direction you go; if your daily commute to your usual workplace is 10 miles, then you should deduct 20 miles (10 each way) from any business mileage claim.
Doofus said:
Business mileage is that travelled for business less the mileage that you would normally do to your usual workplace.
It doesn't matter which direction you go; if your daily commute to your usual workplace is 10 miles, then you should deduct 20 miles (10 each way) from any business mileage claim.
I believe HMRC allow you to claim the full mileage travelled. However some employers can require you to deduct the "Home to Office" portion. It doesn't matter which direction you go; if your daily commute to your usual workplace is 10 miles, then you should deduct 20 miles (10 each way) from any business mileage claim.
TWODs said:
PistonBroker said:
DickP said:
Deducting commuting mileage from business travel is poor form in my opinion and in my sector suggests penny pinching of the employer.
I mean, maybe I'm doing it wrong, but I'm my own boss and I use the office postcode as my start and end point when doing my mileage expenses. Exception to the rule are those who go to an office say on occasion who are home worker by employment contract, they would then be able to claim for wherever they go, providing they then don’t go too regularly to employer office to then fall foul of HMRC rules.
Edited by DickP on Wednesday 3rd April 19:14
This is what the policy where I work states. And it makes sense logically, although where I live is little to do with my employer.
However, I ran a cheap electric for the commute, and running costs were ~2p a mile.
The car with the range to actually do business travel const rather more than HMRC’s 40p a mile.
I took a train.
However, I ran a cheap electric for the commute, and running costs were ~2p a mile.
The car with the range to actually do business travel const rather more than HMRC’s 40p a mile.
I took a train.
pghstochaj said:
Are the costs being passed onto a client? It is a little awkward to claim mileage to a site from home when you pass the office on the way.
Not that kind of employee! (or organisation). They are effectively trying to wangle it so they can claim any mileage from home for business travel and given they live in the arse end of no where would be a bit (but minimal in relation to their total income), this I have a bit of sympathy for, however I know if we shift on this, they'll be straight on to home to office commuting costs (given how much they work from home) and I can't set a precedent for one reasonably senior employee as it will mushroom for the whole workforce.StevieBee said:
Have the employment contracts been amended and agreed to accommodate the dual working locations post Covid?
No, but the the flexible working policy has, however only to restate that the contractual permanent place of work is as originally defined in the contract or subsequent relocation notification, and you'll be required to attend this office as normal commuting as required, beyond that you are able to work from home for any balance as long as it remains productive to do so and business travel can not be claimed for travel to the permanent place of work.Countdown said:
TWODs said:
Employee A now wants to claim 40 miles as commuting can be 0 or 160 miles in a day and employee B wants to claim the full 220 miles on the same principle.
I'm fairly sure that ^^^ is correct. As they are mainly working from home HMRC would regard them as having two temporary workplaces therefore they're entitled to claim mileage starting from home.It is all down to where the stated permanent place of work is. Allowing flexible working is not the same as giving the employee a home office based contract. If the latter then all travel costs can be claimed as expenses, but if the contract is still based on the company office location then only additional mileage can be claimed. I believe this is down to HMRC rules and not your employer.
I had to fight to keep my home based contract when my employer faced a clampdown my HMRC, but given that I live over 200 miles from the office (and did so before starting this employment) it was quite easy to demonstrate that I was not simply choosing to work from home for convenience.
I had to fight to keep my home based contract when my employer faced a clampdown my HMRC, but given that I live over 200 miles from the office (and did so before starting this employment) it was quite easy to demonstrate that I was not simply choosing to work from home for convenience.
DickP said:
I have previously been unable to find such HMRC stated rule. Do you have source on HMRC website?
Not to hand. My understanding is that an employer can *choose* to pay travel expenses for home workers to a stated normal office location, but it would then become a taxable benefit and subject to P11D deductions. I think the HMRC rules have changed a few times.
It used to be "Business miles travelled LESS normal commute"
Then "the LOWER of Home to Temporary site or Office to temporary site"
and now "Actual business miles travelled regardless of whether it's shorter or longer then your normal commute"
It used to be "Business miles travelled LESS normal commute"
Then "the LOWER of Home to Temporary site or Office to temporary site"
and now "Actual business miles travelled regardless of whether it's shorter or longer then your normal commute"
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