Mileage Allowance
If you are required to use your own vehicle for work, you may be able to claim mileage allowance rebate from HMRC based on the number of business miles you travel.
What is Mileage Allowance Rebate
Mileage Allowance Relief is a tax refund from the HMRC for deducting the costs of business trips from your income. Essentially, you can reduce the amount of income you are taxed on. Your overall business expenses (including business mileage) can be taken out of your salary and you only pay tax on the amount leftover
In order to receive Mileage Allowance Relief, you must claim it – it is never given automatically.
How does Mileage Allowance Rebate work?
When your employer works out the amount of tax to deduct from your wages, they will usually total up your salary and then deduct certain allowable expenses. The final figure becomes your gross taxable pay – i.e. the amount on which you are required to pay tax on. So, the lower your gross taxable pay, the less tax you pay. Mileage allowance rebate works by reducing your taxable pay based the total number of business miles travelled in the year, multiplied by specific ‘Approved Mileage Rates’ by HMRC. Any amount reimbursed by your employer reduces this relief.
What counts as business mileage?
Business mileage is any mileage you incur in fulfilling the day to day duties of your job. It does not include travel from your home to your permanent place of work. For example, an electrician may be required to visit different construction sites in his own car, or a healthcare worker may be required to make home visits as part of their job. If you are unsure if your journey counts as business mileage, please contact us and we will be happy to advise you.
What if my employer reimburses me?
You may still be able to claim depending on how much your employer pays you per mile. There are specific amounts on which HMRC are prepared to allow tax relief (see below). If your employer pays you less than this, you can claim tax rebate on the difference.
What if my employer reimburses me?
You may still be able to claim depending on how much your employer pays you per mile. There are specific amounts on which HMRC are prepared to allow tax relief (see below). If your employer pays you less than this, you can claim tax rebate on the difference.
Approved Mileage Rates
| Vehicle Type | First 10,000 Business Miles In The Tax Year | Each Business Mile Over 10,000 In The Tax Year |
|---|---|---|
| Cars and vans | 45p | 25p |
| Motorcycles | 24p | 24p |
| Bicycles | 20p | 20p |
Mileage Allowance Relief can be calculated by multiplying your business mileage by the Approved Rates.
This will give you the amount on which you can claim tax relief amount, not the rebate. You will usually receive 20% – 40% of the final amount back as a rebate depending on the rate of tax you pay.
Example: You travel 5000 miles per year in your own car to visit clients and suppliers. Your employer pays you 25p per mile:
2015/16 5000 x (45p-25p) = £1000 2016/17 5000 x (45p-25p) = £1000 2017/18 5000 x (45p-25p) = £1000 2018/19 5000 x (45p-25p) = £1000
Total Mileage Allowance Relief = £4000 Total tax rebate: £4,000 x 20% = £800
Are There Time Limits For Claiming?
You must claim within 4 years after the end of the tax year. This means you claim relief on all mileage incurred since 6th April 2015, but not anything prior to that. You can claim even if you are no longer at the same employer.
How To Claim Mileage Allowance Rebate?
We provide a easy and quick way for claiming your mileage allowance rebate. We only need a few details from you in order for our accountants to review your claim and process the rebate with HMRC. Simply head to our calculator to see if you are eligible and get started with your claim.
Mileage Allowance
If you are asked to travel to the workplace using a personal vehicle, you may be allowed to claim a mileage allowance rebate from HMRC, depending on the distance you cover when travelling to the office.
Business Mileage Allowance Rebate – Have you claimed yours yet?
You can claim up to 45p per mile for each business journey you have made since April 2015. No matter if you have been using your car daily, weekly, monthly, or even just once, you can be eligible for a large mileage tax refund from HMRC.
Eligible trips include client visits or working from different companies to the one you are based in; you might owe a significant amount in overpaid income tax if you haven’t claimed yet. However, if you wish to make a claim, you need to hurry as there are specific rules and strict deadlines. The sooner you claim, the more chances you have to gain!
You don’t need to spend hours with the calculator measuring your rebate. Use help2compare.co.uk, a free site that helps you calculate your work mileage tax rebate within less than 60 seconds.
Mileage Allowance Rebate – What is it?
UK taxpayers can now claim Mileage Allowance Relief, a special kind of tax refund offered by HM Revenue & Customs to deduct the cost of their business miles from their salary. Primarily, it allows you to decrease the cost of income-you’re taxed on. Your entire business expenditures and your work trips will be deducted from your income, allowing you to pay tax only for the excess amount.
If you have been travelling to the workplace or any other job-related trips using your car since April 2015, it’s an extreme time to calculate how much you could be owed. Employees commonly use their vehicles for business travel, and as compensation, they usually claim the costs of fuel or mileage from their proprietor.
What you might be missing out is that if your proprietor doesn’t pay any mileage cost, or if your company pays a low amount for the business trips you make, then you are eligible to ask for Mileage Allowance Relief, like a tax refund, from HMRC.
It would be best if you claimed for Mileage Allowance Relief as it is never offered automatically.
How does Mileage Allowance Rebate Work?
When your proprietor takes out the tax’s cost to deduct from your income, they generally deduct the expenses from the total amount of your salary. The final price calculated is your gross tax pay, which is the amount you are taxed. Therefore, the amount of tax depends on your gross taxable revenue – the lower it is, the less tax you need to pay.
Mileage Allowance Relief is calculated by reducing your tax pay depending on the total sum of business miles covered throughout the year, multiplied by particular ‘Approved Mileage Rates’ by HM Revenue & Customs. Any cost repaid by your proprietor lowers this relief.
Can I claim even if my Proprietor reimburses me?
Depending on the amount your proprietor pays per mile, you can still ask for a refund. HMRC allows tax relief on particular amounts (mentioned below). If your proprietor pays less than the quantity mentioned here, you are eligible for claiming a tax refund on the difference.
Mileage Rates as approved by HMRC
| Vehicle Type | First 10,000 Business Miles In The Tax Year | Each Business Mile Over 10,000 In The Tax Year |
|---|---|---|
| Cars and vans | 45p | 25p |
| Motorcycles | 24p | 24p |
| Bicycles | 20p | 20p |
Mileage Allowance Rebate can be measured by multiplying your business trips by the above mentioned approved rates. The answer gives you the amount on which you can claim tax relief amount and not the refund. Generally, 20%-40% of the final cost is received as a rebate based on the tax rate you pay.
For instance, Sarah travels 5000 miles each year in her own car to meet clients and suppliers while her proprietor pays 25p per mile:
2016/17 5000 x (45p-25p) = £1000
2017/18 5000 x (45p-25p) = £1000
2018/19 5000 x (45p-25p) = £1000
2019/20 5000 x (45p-25p) = £1000
Total Mileage Allowance Relief is £4000
Total tax rebate Sarah can claim is £4,000 x 20% = £800
Do I need to Claim within a specific period?
Yes, you only have four years once the tax year has ended. According to this, you can only claim relief incurred since April 2015, and nothing before this. You can claim your rebate even if you are no longer working for the same company.
How can I claim my Mileage Allowance Rebate?
Measuring mileage can be challenging for people who do not know taxes, especially if you do not use simplified mileage expenses. Help2compare.co.uk is committed to making your tax experience as stress-free as possible.
We offer a convenient and fast way for claiming your Mileage Allowance Rebate. We’ve helped over 7000 people to claim their rebate in the past few years. All you need to do is answer our few questions so our accountants can review your claim and submit it to the HMRC. Tap our calculator to check if you are eligible and head towards your request.
What information do I need to Provide?
To check your eligibility and have your claim submitted to HMRC, we ask for the following details:
- Employment information (income tax rate, employment status, vehicle type)
- Mileage information (and any mileage expense your proprietor paid you)
Claim your rebate once we are done calculating the final amount. The entire process hardly takes a few minutes.
Why choose help2compare.co.uk?
Help2compare.co.uk has been calculating and submitting claims to HMRC for several decades. We have a long list of satisfied customers who have received their rebates within six weeks. What are you waiting for? Calculate your refund and claim now with our super fast and accurate calculator! We offer:
- Quick Rebate calculation within a few minutes
- Reliable and accurate sum
- Direct claim submission to HMRC
- 100% customer satisfaction