HMRC Fuel Allowance 45p - employer giving lower - this allowed?

lmfy2k · 15 Jul 2011 at 11:11

hi all

not clued up with HMRC and fuel allowances

i just wanted to ask, our company pays us 30p per mile for fuel if we have to go off site and to customer sites etc (im permanent staff).

now ive been reading up on HMRC website and the allowance is now up to 45p per mile

http://www.hmrc.gov.uk/rates/travel.htm

is this allowance a legal right that my employer has to abide by? or is up to the employer what they want to give?

just need some info before i talk to the boss about it lol

Muncher · 15 Jul 2011 at 11:14

It's not a minimum payment!

Cool Breeze · 15 Jul 2011 at 11:16

Your employer is perfectly able to set their own rate, ours is 18.02p per mile for unleaded.

You basically claim the difference back at the end of the tax year, from the tax man using a P87 form.

lmfy2k · 15 Jul 2011 at 11:16

Damn! thanks mate!

will have to try get some more pennies out of him then lol

OllyM · 15 Jul 2011 at 11:22

Cool Breeze said:
Your employer is perfectly able to set their own rate, ours is 18.02p per mile for unleaded.

You basically claim the difference back at the end of the tax year, from the tax man using a P87 form.

No, you claim tax relief on the difference, not the full amount.

WillyNelson · 15 Jul 2011 at 11:22

45p is the limit up to which you pay no tax on the benefit. It's intention is to create a level playing field between taxpayers who get varying per mile payments from their employers. You can claim relief on the difference between what your employer pays you and the HMRC limit as an allowable expense in your annual return.

Cool Breeze · 15 Jul 2011 at 11:24

OllyM said:
No, you claim tax relief on the difference, not the full amount.

Thats what I meant, but thanks all the same :rolleyes:

utajoker · 15 Jul 2011 at 11:38

Cool Breeze said:
, ours is 18.02p per mile for unleaded.

the cheap skates

my fiancee gets 40p per mile. this usualy covers twice the amount of petrol used and then the same amount again.

eg

she uses £20 of petrol, she would get back around £80.

Lethal` · 15 Jul 2011 at 11:50

utajoker said:
the cheap skates

my fiancee gets 40p per mile. this usualy covers twice the amount of petrol used and then the same amount again.

eg

she uses £20 of petrol, she would get back around £80.

I did some work at Open Day for uni the other day, apparently we can get fuel costs back @ 40p per mile so I filled in the form anyway. Looks like I could get more than double what I paid for the journey

Peerzy · 15 Jul 2011 at 12:00

Is it worth doing for someone like me?

I claim about 500-750 miles a year and get paid 40p per mile? Surely to claim the tax relief on 5p over 500-700miles is going to be tiny and just not worth the bother?

40p is pretty much spot on for my fuel consumption.

Scrutinize · 15 Jul 2011 at 12:02

Neither a minimum or maximum, however, whilst I got 11ppm in my last job, I get 58.7ppm in this one.

PMKeates · 15 Jul 2011 at 12:04

Peerzy said:
Is it worth doing for someone like me?

I claim about 500-750 miles a year and get paid 40p per mile? Surely to claim the tax relief on 5p over 500-700miles is going to be tiny and just not worth the bother?

40p is pretty much spot on for my fuel consumption.

700 miles at 5ppm and 40% is only going to be £14, so probably not worth the bother!

Peerzy · 15 Jul 2011 at 12:06

PMKeates said:
700 miles at 5ppm and 40% is only going to be £14, so probably not worth the bother!

Sod that then, not worth it!

Basher · 15 Jul 2011 at 13:03

mrk1@1 said:
Neither a minimum or maximum, however, whilst I got 11ppm in my last job, I get 58.7ppm in this one.

You should be paying tax on everything over the HMRC amount.

DRZ · 15 Jul 2011 at 14:16

Basher said:
You should be paying tax on everything over the HMRC amount.

Yep, which is a huge PITA.

Basher · 15 Jul 2011 at 14:37

DRZ said:
Yep, which is a huge PITA.

Yep, I'd much rather get the standard amount and then the employer to supplement my salary in other ways - much more straightforward.

Django x2 · 15 Jul 2011 at 14:52

Basher said:
You should be paying tax on everything over the HMRC amount.

He will be, therefore making their extra payment near on pointless.

Other quick question. Is it goverened by mileage, i.e you can only claim for the first 10k miles?

DRZ · 15 Jul 2011 at 14:59

Lucero said:
He will be, therefore making their extra payment near on pointless.

Other quick question. Is it goverened by mileage, i.e you can only claim for the first 10k miles?

Yes, there are two rates - it is all very clearly set out on the HMRC site

Frozennova · 15 Jul 2011 at 15:13

Does this cover company vehicles, dad has a company van that is leased and gets 19ppm covering around 26k miles PA from what I've calculated he can claim just shy of 3k going on 26000*0.26*0.40

DRZ · 15 Jul 2011 at 16:00

frozennova said:
Does this cover company vehicles, dad has a company van that is leased and gets 19ppm covering around 26k miles PA from what I've calculated he can claim just shy of 3k going on 26000*0.26*0.40

The HMRC site lists the fuel rate allowable for company vehicles depending on fuel type and engine size here: http://www.hmrc.gov.uk/cars/advisory_fuel_current.htm

As you can see, 19ppm is more than the advised rates for a >2L diesel van.

Unless the van has a petrol engine and is over 2L, he owes the tax man money.

EDIT:

I have just done some more reading and the tax status regarding vans is extremely different to that for company cars. I suspect that in this case, his employer should be reimbursing him via expenses for exact amounts on receipted fuel bills rather than paying a flat rate per mile. These rules are alien to me as there is a flat rate charge which seems to depend on several factors. Either way, pence per mile is not the correct mechanism as far as I can see from that quick glance and he should seek guidance as he might have a significant liability here.