Car Allowance .....

[ringo747]

Just wanted to check another thing here. If I get paid business mileage into my bank account should I be taxed on it?

 

[Rotty]

Just wanted to check another thing here. If I get paid business mileage into my bank account should I be taxed on it?

as long at it is below 40p/mile for first 10k miles and 25p after that then it is not taxable, if it is below these figures then you can claim tax relief on the difference

 

[edscdk]

But of course if by getting the car allowance your pay increases to the next tax bracket... you may not be better off!

i think if you go into the next tax bracket you only have to pay tax on the amout you earn over the lower tax

to keep it simply

0 - 10k = 20%
11-15k= 25%

if you earn 12k you pay

20% of the first 10K
then 25% of the next 2k

 

[Confused]

Yup, that's been explained properly above and I now understand it properly!

 

[ringo747]

as long at it is below 40p/mile for first 10k miles and 25p after that then it is not taxable, if it is below these figures then you can claim tax relief on the difference

I currently get around 37.5p per mile at the moment but once I get a car allowance it will be down to around 15p.

 

[Rotty]

I currently get around 37.5p per mile at the moment but once I get a car allowance it will be down to around 15p.

then you can claim tax relief


first 10k miles you get



((40-15) x marginal tax rate) pence per mile

after 10k replace 40 with 25

you can claim at moment but with 37.5 replacing 15 in above

 

[ringo747]

then you can claim tax relief


first 10k miles you get



((40-15) x marginal tax rate) pence per mile

after 10k replace 40 with 25

you can claim at moment but with 37.5 replacing 15 in above

Thanks for that - must check that out.

 

[Sin_Chase]

I claim my car allowance as a benefit, and over here (In Jersey) I believe it is taxed at a lower rate.