Company not paying the advisory mileage rate

[EddyP]

HI All,

Not sure if there's anything I can do about this but thought it worth asking.
I qualify for a company car, which is either a crappy old Astra or a waiting list for an electric Kona at the moment. I've always taken the allowance instead which is around £250/month so not that great.
The company has decided not to use the HMRC guidance and apply a single mileage rate, which is currently 13p/mile.
My daily driver is a 2.3L so the HMRC guidance rate would be 16.3p/mile. I've asked our expenses team why they don't apply the different rates per engine size as HMRC advise and their response was:

"For those with a conventional fule company car we pay the mileage rate for that fuel type and engine size. As this is an average mid sized car we mirror this rate for those with car allownaces. Your own car and engine size is a personal choice."

I presume the only thing I can do is to claim the tax relief on the differnce between what's paid and the 45p/mile?

[Eric Mc]

Yes. That's all you can do. It's an "advisory rate", not a "compulsory rate".

[Simpo Two]

EddyP said:

"For those with a conventional fule company car..."

I'd be worried they can't spell fuel!

[Eric Mc]

I thought every fule new how to spell fule.

[Scrump]

If you take the allowance (and don’t have a company car) you could claim the tax back on the difference between 13ppm and 45ppm (for the first 10k business miles pa).

[38911]

You could challenge this bit of their response "we pay the mileage rate for that fuel type and engine size." by asking for their methodology in calculating the rate and challenging it from there..... but ultimately its their choice what mileage rate to offer and your choice whether to accept it or find alternative employment.

£250/m car allowance is truly a pittance, and perhaps speaks volumes about your employers 'generosity'.

[EddyP]

Thanks all, thought that would be the case.