Use of own car by company director

Travel expenses

Didn't find your answer?

A new client is a company director.  The company pays the HMRC rates for using his own car on business trips (45p per mile up to 10000 miles and 25p per mile thereafter).  So far - so good.  However, he has now produced his 2016/17 P60 and indicates that some £4000 of the income shown on the P60 is for travel expense reimbursement at the above rates.  

My understanding was that any amounts paid in excess of the agreed rates goes on a P11D and any shortfall paid as against the HMRC rates are claimable on the director's tax return but where the amounts paid equate to the HMRC rates - no reporting is required. 

I can't think of any circumstances in which the amounts paid out for use of his own car in these circumstances end up on the P60.  Am I missing something?

Replies (17)

Please login or register to join the discussion.

By Marion Hayes
08th Aug 2017 12:46

Is he trying to tell you that part of his physical drawings have been mis-classified as earnings and put through payroll by mistake?

Thanks (0)
avatar
By gilderda
08th Aug 2017 13:00

Could it be that he's confusing mileage payments with having an essential user car allowance built into his annual salary and taxed through PAYE?

Thanks (0)
avatar
By Matrix
08th Aug 2017 13:14

It looks like an error, he should contact the payroll department of his employer for clarification.

Thanks (0)
Portia profile image
By Portia Nina Levin
08th Aug 2017 13:25

The HMRC.

Thanks (0)
Replying to Portia Nina Levin:
avatar
By John Stone
08th Aug 2017 13:46

Portia - I don't follow when you say 'The HMRC'. Can you briefly elaborate.

Thanks (0)
Replying to John Stone:
Portia profile image
By Portia Nina Levin
08th Aug 2017 14:00

Ha! My bad! It's the HMRC rates.

Thanks (0)
Replying to Portia Nina Levin:
avatar
By andy.partridge
08th Aug 2017 13:48

Why the definite article?

Thanks (0)
Replying to andy.partridge:
Portia profile image
By Portia Nina Levin
08th Aug 2017 14:00

A HMRC sounds really horrible!

Thanks (0)
Replying to Portia Nina Levin:
avatar
By andy.partridge
08th Aug 2017 14:37

Apology accepted!

Thanks (0)
Replying to andy.partridge:
Portia profile image
By Portia Nina Levin
08th Aug 2017 14:51

You're welcome.

Thanks (0)
Replying to Portia Nina Levin:
avatar
By John Stone
08th Aug 2017 15:17

Portia - as the poor old question-setter I am still behind the curve on this. How does 'the HMRC rates' answer my original query? I still don't follow.

Thanks (0)
Replying to John Stone:
Portia profile image
By Portia Nina Levin
08th Aug 2017 15:27

Oh I doubly apologise if you mistook my response for an attempt to answer your question. I was being - it turned out inappropriately - pedenatic.

The answer to your question is that there's been some sort of a ¢0¢k up.

Thanks (0)
Replying to Portia Nina Levin:
avatar
By John Stone
08th Aug 2017 15:41

Message understood. Thank you.

Thanks (0)
Replying to Portia Nina Levin:
avatar
By gilderda
08th Aug 2017 17:19

It's a good job I'm not the sort of pedent to pick up on typos :)

Thanks (0)
Replying to gilderda:
avatar
By Tax Dragon
08th Aug 2017 18:10

Pedenat.

Sorry.

Thanks (0)
Replying to Portia Nina Levin:
RLI
By lionofludesch
09th Aug 2017 08:35

Portia Nina Levin wrote:

A HMRC sounds really horrible!

An HMRC, surely.

Thanks (0)
avatar
By John Stone
09th Aug 2017 10:17

Client has emailed me this morning to say that he has just remembered that the £4000 he originally indicated was travel expenses was in fact a performance-related bonus. Arghhhhhhh! Sorry everyone.

Thanks (0)