What governs the right to claim tax-free mileage allowance?

[brendanrjohn]

I have got stuck with an issue involving cars owned privately and used by the business of which I am a director. 2 cars are used, both of which were purchased privately in my name, since my friend and co-director was unable to obtain credit due to insufficient credit history in the UK. We make payments on one car each, although as far as the credit company is concerned, both sets of payments come from me.

My question is:
What piece of evidence is the one which governs my friend's right to receive tax-free mileage allowance for using his car in our business? Is it enough to have him as the registered keeper of the vehicle?

Does anyone have any experience of a similar situation?

Any suggestions most honestly welcomed.

Brendan

[taxationuk]

Hi Brendan

As long as he is using the car for Business reasons, he can claim the mileage allowance for the business miles consumed. He does not have to own the car to claim this.

Kind regards

Terry Hodge
th@taxationuk.com

[Gnome]

The legislation involved is good old S336 ITEPA 2003 if you need a piece of legislation to back up your argument.