Car allowance

[martinzane]

I get £4200 car allowance per annum plus £0.24 per mile for business miles. 99% of the time i travel from home to numerous transient construction sites visiting the office 2-3 times a week. I live 41 miles away from the office and my company are now trying to charge me 80 miles per day as personal mileage to and from the office although i do not do this on a regular basis. One example is i can visit 6 sites in a day clocking up 180 miles not going to the office and my company are trying to now say they won't pay me for 80 miles a day. Can anyone help?

I did have a company van before which i paid tax on but they also charged me personal mileage which i have been told is incorrect as well, is this right?

[Instinctive]

There are two issues:

(1) Amount your company agrees to pay you is entirely a matter between you and your employer, subject to anything in your contract of employment. Any outside person cannot influence this.

(2) How much of the allowance you receive which can be treated as an expense of your business. Any excess allowance received by you will be taxed to you as benefit in kind.

[Bob Jones]

You are an employee and it appears that you have what is commonly referred to as a "travelling appointment" - in other words the travelling is in the performance of the duties of the employment as opposed to under the "new rules" that were introduced as from 6 April 1998. I am of the opinion that you would qualify under the old rules (but please rmember you cannot calim for travel to and from home to office. I assume that you have claimed travel expenses on your tax return in the past - you should continue to do so on the same basis as before. If on a day when you travel 180 miles visiting 6 sites and not going to the office all 180 miles will qualify for tax relief but your employer is not going to reimburse 80 of those miles - As Instinctive says, this is a matter between you and your employer - it will affect the calculation of the tax allowance due to you if your expense exceeds the employers allowance or the benefit if it is the other way round. Regarding the company van - again this was an arrangement between you and your employer with your employer calling the shots - the arrangement could have an effect on the benefit that would be charged to tax.

Bob

[Liz2]

I wonder if someone could help me.
I currently work as a Clerk in an office in the Warwickshire area. I travel from home to work using my car & do 35 miles round trip.
I am also setting up a cleaning business totally different to my current job in the same area (with a 35 miles round trip similar to that of my home to office).
My new business also requires visiting clients homes or offices to give them an estimate for cleaning their premises or actually carrying out the work.
Therefore on the days that I visit the clients premises for my cleaning business, I will travel to the office for my normal job & then to clients premises after work.
I would be grateful if you could tell me whether I can claim the full mileage from home to the clients premises (@40p per mile up to 10000 miles) as my expense against the profits for my new business,or whether I would need to subtract a portion of the mileage because it is the same as I would have done in going from my home to my office?

Regards,

Liz2

[Bob Jones]

Liz

This is a difficult one - you cannot claim a dual purpose journey. I used to work for HMRC and I met a taxpayer in the chip shop - she had called on her way home - strictly a dual purpose journey and not allowable - but of course HMRC would never know .. To be on the safe side subtract a portion of the mileage as you do have a dual purpose journey ..

Bob Jones
Internet Taxation Ltd
bob@internet-taxation.co.uk