Many companies pay mileage allowance when using your personal car for business travel below the approved rates issued by HMRC. These rates are 45p per mile (40p up to April 2011) for the first 10,000 business miles and 25p per mile thereafter.
If this applies to you, it is possible to claim tax relief on the difference between the approved rates and the amount you received from your employer. The tax relief is given at your marginal rate of tax (i.e. 20%, 40% and 50%) and reduces your income tax each year.
This can lead to a tax refund payable to you.
You are able to go and claim this relief for the 2008-2009 tax year onwards.
We have recently obtained a refund of £2,700 for a client where they had travelled 11,000 business miles per annum on average and received 20p from their employer.
If you would like further information on this or any other tax matter, or would like assistance in making the claim, please contact Karen Robinson on 0161 975 6723 or via email email@example.com.