I have sent a P87 form to HMRC and they have written back to me asking a few questions. One of them is why do my employers not pay mileage allowance (I am claiming back the tax relief on the whole 40p per mile as I have not been paid anything).
I work in the construction industry and so as far as I am aware my workplace is classed as temporary because I am based in the offices which are on the construction site.
I am not sure why I don't get paid any mileage allowance – it just isn't in my contract. Do employers have any legal obligation to pay mileage allowance?
Mileage allowance is the most common benefit offered to employees in the UK. The guidance regarding the tax treatment of this benefit is complex, but it hinges on a number of easily understandable premises. The first of these is that mileage allowance benefits are just that – benefits. While you are entitled to Tax Relief On Your Mileage, your employer is not under any obligation to pay any set amount.
If you're claiming mileage expenses and want to understand how this affects your overall take home pay, you can use our free Income Tax Calculator.
What Should Employers Pay?
As it stands, employers may, at their discretion, pay mileage allowance at a rate of up to 45 pence per mile* for the first 10,000 miles travelled by an employee. Any mileage over this amount can be reimbursed at a rate of 25 pence per mile. However, the rate at which employers actually pay can vary wildly.
In your case, it would appear that you are not being reimbursed at all. It is important to remember that the 45 pence per mile rate is not necessarily money to which you are entitled – that is, it is not money that either your employer or the taxman is statutorily obliged to part with. Rather, you are entitled to tax relief on a portion of your income equivalent to 45 pence for each of the first 10,000 miles, and 25 pence for each mile after that.
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Tax Relief
The short answer, therefore, is no, your employer does not have to pay you a mileage allowance. However, the taxman offers tax relief on the difference between the rate at which your employer offers reimbursement, and the maximum allowable rate of 45 pence per mile. In your case, they should therefore offer 100% tax relief.
To a certain extent, however, the tax office is right to ask why you are not being offered mileage allowance, particularly given the requirements of your employment. Employers usually find that it is in their interests to offer mileage allowance, particularly if it avoids the necessity to provide a company car fleet. Regardless, aside from the fuel costs you must also consider the cost to you in terms of the depreciation of your vehicle. As such, if you are in a position to do so you may wish to push your employer to begin offering this type of benefit.
*Figures have been updated for this 2011-12 tax year.
Perhaps when considering ONLY tax-legislation, the writer is correct, however, workers in the UK are entitled to receive at least National Minimum Wage rates for every hour worked (Which incidentally includes travel time where this travel is a requirement of the job; i.e. travel from one building site to the next, not including breaks or commute to/from home/work).
When calculating whether NMW has been paid, any expenses made in connection with employment (such as travel expenses, PPE, work-attire, tools & equipment) will be taken off the figure of pay received before the calculation is made...
This means that workers who earn a fair bit above NMW and work enough hours may well be able to "absorb" these expenses without falling below NMW. However, a worker who is being paid the NMW rate and where these expenses are not taken into account will end up being underpaid.
Therefore, for workers whose ordinary rate is at- or only slightly above- NMW, the employer will have to reimburse expenses / pay an allowance to prevent the worker dipping below NMW.
The current rate will not cover any maintenance the vehicle requires. Does this mean I'll have to wait till next year to claim back only a portion of this from HMRC?
Please help!
They pay the other chap Travel Time.
I have been changed from office based to home based by my company. I have been told I cant claim the first 30 miles of my mileage claim everyday when I visit services in my company car. As most of the services in my area are lee than 30 miles this means I will lose out on mileage payments. Is this right
My employer is applying rules that do not match the HMRC documents regarding what journeys should be paid mileage on. I.e. new rules are deducting the distance from home to the office even if we go tdirect to the clients where the office is defined as our base. As per the Employee Milage 490 document from HMRC this journey would count as we are required to go to client sites as tech support.
Can an employer decide what journeys count as qualifying for mileage to be paid or not follow the rules but still pay mileage?
I understand that the employer could simply not pay a mileage allowance but can they pick and choose what journeys and rules they decide to follow to pay mileage?
MS
It doesn’t seem fair that my employer is making a profit on my business expenses.
My employer doesn't pay any mileage allowance, however they offer a company car scheme. My problem is, if I decline the company car, they don't offer any car allowance nor mileage allowance.
In this case, could I claim back using the tax form?
until this year I would claim the .45p per mile upto 10000 miles. Then drop to .25p
I had contact from Concur stating that the rate is fixed at .45p regardless of mileage covered.
I'm concerned this isn't correct, any thoughts?
I left a business in October 2017, on leaving I was due mileage expenses and holiday pay, the business is refusing to pay me by saying that they have checked my previous mileage claims and these are incorrect, and I have been overpaid. If I do not drop the claims for my outstanding monies they will report me to HMRC, despite my expenses being authorised by a Director of the business every month for the last 3 years.
On the Mileage Expense the issue seems to be the base for my place of work...........Since I started my base has been an office in Preston, I went there in the morning and reported back there at night if I was not out on call. The Director is now saying I had 2 places of business, the manufacturing site in Manchester for which I was responsible for in sales work and the Preston office.
In the 3 years I never claimed mileage travelling from my home base to Preston or going back to home but would claim travelling from the likes of the Preston base to Manchester manufacturing and If I spent the day at Manchester I would claim the return journey home, as I did not class Manchester as my base.
My question is, can you have 2 places for base when dealing with business mileage,
Any advice would be greatly appreciated.
Can my employer turn me down like that when other colleagues live closer to temp site and been paid expenses? Once more I'm highlithing that employer made new policy when I've been already supporting temp site. Also I havn't been offered company car and I don't belive that my employer got right to tell me where I will travel by my own car without paying me expesnse for using it.
Kind Regards
Can I claim Mileage Payment Allowance for the 40 miles per day the company will not cover & all the additional 20p/ mile difference in the Tax Rate of 45p/ mile (2015 rate)?
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