Mileage Allowance and Record Keeping
Discussion
Hi all, in need of some advice while I am helping Mrs. Steelflex with her tax affairs.
She currently works as a home carer, driving to 'clients' in their homes every day in her personal car. She does not receive any mileage payment from her employer. In a typical day, most of the houses she visits are the same, save for one or two new locations every now and then, and in total mileage is between 15 and 20 miles per day over 5/6 days per week. She will sometimes do 2 shifts in one day if needed to cover, however she does not drive every day as the carers work in pairs and share the load.
The issue we have is what is the right amount of record keeping? This is important because she has been claiming only a small amount of mileage (1,800 per year) because she used to do the job part time and we just estimated 12 miles x 3 shifts per week x 50 weeks. HMRC have never queried this and have just added £800 to her tax code for the past 3 years. As she is now working full time (since April) and doing a lot more miles, we need to adjust it again but I am concerned that we will then need to provide detailed mileage calculations, etc.
I know she can call and ask HMRC, but this will possibly trigger them asking her for the records she currently doesn't have. There is also the confusion about 'permanent place of work' as there isn't one, so if we claim for every mile driven then this may not look correct, as the start and finish postcode of any work journey is our home address.
Bearing in mind she is barely paying tax at the moment, is it worth it anyway? - I think rather than stick it on the tax code, she could just start getting records in order and then stick a claim in at the end of the year as some form of tax refund?
She currently works as a home carer, driving to 'clients' in their homes every day in her personal car. She does not receive any mileage payment from her employer. In a typical day, most of the houses she visits are the same, save for one or two new locations every now and then, and in total mileage is between 15 and 20 miles per day over 5/6 days per week. She will sometimes do 2 shifts in one day if needed to cover, however she does not drive every day as the carers work in pairs and share the load.
The issue we have is what is the right amount of record keeping? This is important because she has been claiming only a small amount of mileage (1,800 per year) because she used to do the job part time and we just estimated 12 miles x 3 shifts per week x 50 weeks. HMRC have never queried this and have just added £800 to her tax code for the past 3 years. As she is now working full time (since April) and doing a lot more miles, we need to adjust it again but I am concerned that we will then need to provide detailed mileage calculations, etc.
I know she can call and ask HMRC, but this will possibly trigger them asking her for the records she currently doesn't have. There is also the confusion about 'permanent place of work' as there isn't one, so if we claim for every mile driven then this may not look correct, as the start and finish postcode of any work journey is our home address.
Bearing in mind she is barely paying tax at the moment, is it worth it anyway? - I think rather than stick it on the tax code, she could just start getting records in order and then stick a claim in at the end of the year as some form of tax refund?
Keep a diary with every employment related trip recorded.
If she travels from home to a "client" for her first job of the day, that does not count as an employment related journey (i.e. it equates to the "normal commute" - which is never claiomable). Trips from client to client during the working day should be claimable. The trip home from the last client of the day would not be claimable as that forms part of the "normal commute".
(I've just come back from a weekend course on tax and related matter - you can tell).
If she travels from home to a "client" for her first job of the day, that does not count as an employment related journey (i.e. it equates to the "normal commute" - which is never claiomable). Trips from client to client during the working day should be claimable. The trip home from the last client of the day would not be claimable as that forms part of the "normal commute".
(I've just come back from a weekend course on tax and related matter - you can tell).
Thanks Eric, I did expect that and it's good to be aware.
The record keeping is a pain though when there may be 20 journeys in a day, some less than a mile at a time. I keep hoping for some pragmatism where HMRC would accept an estimate or average per day based on historical trends. I know we will need to ask in the end, so perhaps work to worst case (go back over the last 6 months and document every single trip) and see what happens.
They have never asked for records, the last time she called up she just told them what was happening and she got a cheque in the post and the tax code updated.
The record keeping is a pain though when there may be 20 journeys in a day, some less than a mile at a time. I keep hoping for some pragmatism where HMRC would accept an estimate or average per day based on historical trends. I know we will need to ask in the end, so perhaps work to worst case (go back over the last 6 months and document every single trip) and see what happens.
They have never asked for records, the last time she called up she just told them what was happening and she got a cheque in the post and the tax code updated.
Eric Mc said:
Keep a diary with every employment related trip recorded.
If she travels from home to a "client" for her first job of the day, that does not count as an employment related journey (i.e. it equates to the "normal commute" - which is never claiomable). Trips from client to client during the working day should be claimable. The trip home from the last client of the day would not be claimable as that forms part of the "normal commute".
(I've just come back from a weekend course on tax and related matter - you can tell).
So if:If she travels from home to a "client" for her first job of the day, that does not count as an employment related journey (i.e. it equates to the "normal commute" - which is never claiomable). Trips from client to client during the working day should be claimable. The trip home from the last client of the day would not be claimable as that forms part of the "normal commute".
(I've just come back from a weekend course on tax and related matter - you can tell).
Client A is 1 mile away from home
Client B is 7 miles
Client C is 2 miles
Client D is 5 miles
Client E is 12 miles
Arrange appointments so that Client A and C are the first and last stops of the day.
Eric Mc said:
If she travels from home to a "client" for her first job of the day, that does not count as an employment related journey (i.e. it equates to the "normal commute" - which is never claiomable).
......
The trip home from the last client of the day would not be claimable as that forms part of the "normal commute".
I've never heard that before - is that new?......
The trip home from the last client of the day would not be claimable as that forms part of the "normal commute".
In my case I often do a 400 mile round trip to one customer. Taking what you said literally, I wouldn't be able to claim.
And it's long been the case that HMRC have had an example of someone leaving home, calling into the office, and then going on to a customer - with the whole journey being claimable.
It's entirely normal for employers to do the triangulation thing. Indeed HMRC as an employer does it for its own staff. But they don't apply it to tax-payers.
Eric Mc said:
I picked it up on the weekend.
I think somewhere along the line there's been a misunderstanding. It doesn't make any sense for home based employees.For office based employees, it's long been a bit of an oddity that they can been claim tax relief on the entire journey - but I'm not aware that's changed. Doesn't mean it hasn't changed - I might have missed it.
There is a huge amount of confusion regarding certain types of employees as to when their "work" actually starts.
There have been arguments and tribunal hearings over all sorts of aspects of this type of working as to whether "home to work" is done "before" the employee start working or is part of their actual work - especially in regards to working hours, national minimum wage, holiday entitlement etc.
Would some argue that a "home based worker" starts work as soon as they leave home - even if no actual "work" starts until they arrive at their first place of work?
There have been arguments and tribunal hearings over all sorts of aspects of this type of working as to whether "home to work" is done "before" the employee start working or is part of their actual work - especially in regards to working hours, national minimum wage, holiday entitlement etc.
Would some argue that a "home based worker" starts work as soon as they leave home - even if no actual "work" starts until they arrive at their first place of work?
Eric Mc said:
Would you argue that a "home based worker"£ starts work as soon as they leave home - even if no actual "work" starts until they arrive at their first place of work?
It is an arguable point. In my opinion in the case of the employees in the OP's question, they're travelling at the direction of their employer, so that is business travel.It becomes ridiculous per the example given by oyster - the amount they can claim would be quite significantly affected by their routing. The employer could manipulate that to their advantage, although irrelevant in this case as they're (outrageously) not paying a mileage allowance.
oyster said:
So if:
Client A is 1 mile away from home
Client B is 7 miles
Client C is 2 miles
Client D is 5 miles
Client E is 12 miles
Arrange appointments so that Client A and C are the first and last stops of the day.
You can't do that if you work in care.Client A is 1 mile away from home
Client B is 7 miles
Client C is 2 miles
Client D is 5 miles
Client E is 12 miles
Arrange appointments so that Client A and C are the first and last stops of the day.
My Mrs worked in care, you may have breakfast, lunch dinner and bed calls for 4 different clients throughout the day scheduled as this is what will have been agreed in the care plan.
You can't just go to client X first
oyster said:
So if:
Client A is 1 mile away from home
Client B is 7 miles
Client C is 2 miles
Client D is 5 miles
Client E is 12 miles
Arrange appointments so that Client A and C are the first and last stops of the day.
Beaten to it above ^^^Client A is 1 mile away from home
Client B is 7 miles
Client C is 2 miles
Client D is 5 miles
Client E is 12 miles
Arrange appointments so that Client A and C are the first and last stops of the day.
Can't do that unfortunately as the employer sets the order in which the clients are visited (based on their personal/medical needs), although the staff do adjust it a little once they get to know the clients better. It's not critical though, as all of the clients are within a 4 mile radius or so, so it would never amount to much.
sheepshanks said:
not paying a mileage allowance
Indeed, but as they are allowed to do this then they will, there's not a lot of moey in social care so i'm told. Interestingly, very few of my wife's colleagues bother to claim this mileage allowance as they think it is difficult. Edited by Jefferson Steelflex on Tuesday 22 November 16:07
condor said:
I use AA route planner to work out mileage between clients - I'm fairly sure I asked this question on a thread within the last 6 months and that was the answer I came away with. Then it's charged as 45p/mile for expenses.
The 45p is only for the first 10,000 miles. After that it drops to 25p.
And the second question was, is it even worth it if she will be out of paying tax altogether soon? When the personal allowance increases in 2017, I doubt she will pay tax at all anyway. How does the mileage allowance work then?
Simply adding a lump on to her tax code will have no effect.
Simply adding a lump on to her tax code will have no effect.
Eric Mc said:
There have been arguments and tribunal hearings over all sorts of aspects of this type of working as to whether "home to work" is done "before" the employee start working or is part of their actual work - especially in regards to working hours, national minimum wage, holiday entitlement etc.
Picking up that point: http://www.nabarro.com/insight/alerts/2015/septemb...Bit of Googling shows this "first and last journey" thing crops up quite a bit, but when asked no-one has been able to link to any HMRC guidance. I wonder if this is one of those things that HMRC makes up on the hoof?
The only thing like it is that when someone lives outside their patch, travel to the edge of the area is regarding as commuting - so that would seem to imply that all travel within the area is claimable.
Jefferson Steelflex said:
And the second question was, is it even worth it if she will be out of paying tax altogether soon? When the personal allowance increases in 2017, I doubt she will pay tax at all anyway. How does the mileage allowance work then?
Simply adding a lump on to her tax code will have no effect.
If you don't earn enough to pay any tax, then you can't get any "tax relief". Simply adding a lump on to her tax code will have no effect.
Employers should, of course, be paying mileage. It's pretty awful that they aren't.
Eric Mc said:
Jefferson Steelflex said:
And the second question was, is it even worth it if she will be out of paying tax altogether soon? When the personal allowance increases in 2017, I doubt she will pay tax at all anyway. How does the mileage allowance work then?
Simply adding a lump on to her tax code will have no effect.
If you don't earn enough to pay any tax, then you can't get any "tax relief". Simply adding a lump on to her tax code will have no effect.
Employers should, of course, be paying mileage. It's pretty awful that they aren't.
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