• Posted 1st October 2015

Business Mileage Tax Relief

Wondering whether you can claim tax relief for business mileage or not? If you are, then the answer is yes you can. As an employee, business mileage can help you cut some amount from your tax bill. Using your own vehicle for business purposes entitles you to claim ‘Mileage Allowance Relief’. In addition, claiming tax relief for the fuel you pay when using your company car for business purposes is also possible. In order to know about the amount of the tax relief you can claim, you just have to add up your business mileage for the tax year and then multiply it by the approved mileage rates. And, if the mileage allowance provided by your employer is less than the approved amount, here again you have the right to claim Mileage Allowance Relief on the difference. Alternatively, if your employer pays you more than the approved amount, it is considered as a benefit and it is your duty to pay the tax on the difference. To ensure you get your tax reliefs, you must keep records of the business travels including dates, destination, purpose of the trip and mileage of your work journeys on a day-to-day basis. A statutory system of Approved Mileage Allowance Payments (AMAPs) for business journeys are: On the first 10,000 Each business mile over miles in the year 10,000 miles in the tax year Car/Van 45p per mile 25p per mile Motorcycles 24p per mile 24p per mile Bicycles 20p per mile 20p per mile If you use multiple vehicles of the same type, combine all their business miles together and calculate them. Likewise, if you use different types of vehicles, do not combine and calculate them separately. You may also incur other business travel expenses like travel fares, meals or overnight accommodation (subsistence), and parking charges. If you pay them and get reimbursed, it will be treated as a taxable benefit on you in the first instance. And, to cancel the tax liability that arises on the benefit, you should make a tax relief.