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Where Taxpayers and Advisers Meet

Claim business Mileage Relief or not?

James Robinson
Posts: 5
Joined: Fri Oct 19, 2018 10:59 am

Claim business Mileage Relief or not?

Postby James Robinson » Fri Oct 19, 2018 11:11 am

Hi all,

Would welcome some guidance and expert opinion on a issue I am querying at work.

My employer provides a fuel card for my private car, which I use to pay for both business mileage fuel (est. 20k miles per annum) and personal fuel (est. 10k miles per annum).

However my employer makes me record meticiously and pay back all my private mileage to the company, to the sum of 12 pence per mile which is deducted from my monthy salary. I believe this avoids additional tax (BIK?) so it is somethingI am more than happy doing.

However, the contensicious issue: Given my situation, can I claim back tax relief on business mileage from the government based on the approved mileage rates (45p per mile up to 10k miles and then 25p thereafter). As I am a 20% tax payer and cover an estimated 20k business miles, can claim back 20% tax relief on £7,000 (10,000 miles at 45p and 10,000 miles at 25p). This would give me a tax relief/rebate of £1,400 for the year.

Does this make sense or not? Because I pay back my private mileage fuel to my employer every month, my employer told me I cannot claim back any mileage relief from the government for business mileage.

Any help would be much appreciated.

James

darthblingbling
Posts: 145
Joined: Wed Aug 02, 2017 9:09 pm

Re: Claim business Mileage Relief or not?

Postby darthblingbling » Fri Oct 19, 2018 10:32 pm

Your employer is already paying for your business fuel directly so why would you claim relief?

James Robinson
Posts: 5
Joined: Fri Oct 19, 2018 10:59 am

Re: Claim business Mileage Relief or not?

Postby James Robinson » Sat Oct 20, 2018 12:37 am

Because my employer paying for fuel only doesn't take into account any business mileage related expenses e.g. maintenance, servicing, tyres, etc. All of these are accounted for in the 45p per mile (fuel costs only est. 12p per mile) so you can attribute a good portion of that 45p to these business mileage related expenses....

darthblingbling
Posts: 145
Joined: Wed Aug 02, 2017 9:09 pm

Re: Claim business Mileage Relief or not?

Postby darthblingbling » Sat Oct 20, 2018 10:55 am

I can see where you're coming from, but unfortunately you cannot claim business mileage if your employer pays for the fuel.

Remember, the 45p or 25p that you can claim if you were to pay for fuel is only taken off your taxable income, it's not a 45p or 25p refund from your tax.

Example, if you earned £45k per year and did 20,000 business miles, this would equate to £4,500 + £2,500 = £7,000 as an expense.

Income tax on £45,000 is £6,630
Income tax on £38,000 is £5,230

Therefore a lower tax liability of £1,400 if you were to instead pay for fuel and claim as business mileage.

Typical Ford Mondeo 2.0 Diesel apparently costs £2,980 per year to do 20,000 miles according to a fuel calculator I found on Google. Obvious caveat that this is not accurate and you may have a much more efficient car or are a much more efficient driver.

But as you will see you are likely better off with the employer paying for the fuel.

Alternatively the employer could pay you the 45p or 25p direct as opposed to paying for your fuel, but as you obviosuly do thousands of miles per year this is not cost effective for them and I doubt they'd go for it.

darthblingbling
Posts: 145
Joined: Wed Aug 02, 2017 9:09 pm

Re: Claim business Mileage Relief or not?

Postby darthblingbling » Sat Oct 20, 2018 10:58 am

Perhaps speak to your employer to see if they are willing to cover the additional costs of wear and tear and additional costs to your insurance to cover business travel.

darthblingbling
Posts: 145
Joined: Wed Aug 02, 2017 9:09 pm

Re: Claim business Mileage Relief or not?

Postby darthblingbling » Sat Oct 20, 2018 11:36 am

Actuially, I'm concious I'm barking up the wrong tree here.

Ignore what I've said, AMAP is based on use of a private car, not whether you're paying for fuel.

Sorry for the confusion.

James Robinson
Posts: 5
Joined: Fri Oct 19, 2018 10:59 am

Re: Claim business Mileage Relief or not?

Postby James Robinson » Sat Oct 20, 2018 11:51 am

Appreciate the help and for the replies!

So the long and short of it (sorry your last comment threw me) - my private car and paid business fuel (no AMAP rates given)- nothing I can do r.e. claiming back something?

James

darthblingbling
Posts: 145
Joined: Wed Aug 02, 2017 9:09 pm

Re: Claim business Mileage Relief or not?

Postby darthblingbling » Sat Oct 20, 2018 12:17 pm

Sorry, long and short of it, you probably can make a claim for your business mileage.

The fact that the employer pays for fuel is seemingly irrelevant.

James Robinson
Posts: 5
Joined: Fri Oct 19, 2018 10:59 am

Re: Claim business Mileage Relief or not?

Postby James Robinson » Sat Oct 20, 2018 1:22 pm

Oh ok, that's good news then!

Appreciate the responses, you don't happen to know how - if this would be a P87 claim or a self assessment do you?

Thanks for the help.

bd6759
Posts: 3010
Joined: Sat Feb 01, 2014 3:26 pm

Re: Claim business Mileage Relief or not?

Postby bd6759 » Sat Oct 20, 2018 2:34 pm

I can see where you're coming from, but unfortunately you cannot claim business mileage if your employer pays for the fuel.
That is not correct.

The employee can claim tax relief on 45p/25p per mile less the amounts reimbursed. The amount reimbursed is the cost of the fuel less 12p per private mile.


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