Mileage rates

Mileage rates

Didn't find your answer?

Hi all

I would appreciate a bit of advise on this as I cant seem to find anything definitive from HMRC.

At the moment we have some employees with company cars and we pay the advisory rates for business mileage thus avoiding any tax/Class 1A NI issues etc. The plan now is not to renew any company cars as their leases come to an end and not to give any new employees a company car. What we will do however, is pay them a car allowance each month instead.

The question is then, is there an advisory rate for mileage in this instance?  Is it the same as the company car rate, or do we just use the 45p/25p rates?

Many thanks

Replies (5)

Please login or register to join the discussion.

avatar
By pjones
18th Mar 2015 15:07

45p/25p

The employees are using their own cars therefore the 45p/25p rates are applicable

Thanks (2)
avatar
By brucklay
18th Mar 2015 15:15

Thanks very much for the quick response

 

Thats great...also stops me having to go back to the first person on a car allowance and telling them I have been allowing them to claim mileage at the wrong rate for the last two months!

Thanks (0)
Replying to Peter613:
avatar
By brucklay
19th Mar 2015 08:22

I think that may be the feeling with some of the directors here, but it is good to know that we can if we wish pay the 45p/25p rate

Many thanks

Thanks (0)
avatar
By paulhammett
19th Mar 2015 08:26

Taxable
The monthly tax allowance is of course taxable.

Thanks (0)
Replying to lionofludesch:
avatar
By brucklay
19th Mar 2015 09:32

Yes, the car allowance goes through payroll and is taxed/NICed as necessary

Thanks (0)