Mileage allowance
Written by Ray Coman
| Per mile | ||
| Private cars and vans | First 10,000 miles in the tax year | 45p |
| Additional miles | 25p | |
| Each qualifying passenger | 5p | |
| Motorcycle | 24p | |
| Bicycle | 20p |
The mileage allowance determines the amount that an employee or director may deduct from taxable income for the use of their own car, motor bike or bicycle for business journeys. If motor costs have been reimbursed by the employer, then any excess reimbursements over the above rates are taxable, and any shortfall is tax deductible. As any exception, any shortfall in reimbursement of passenger payments is not deductible.
An employee or deducting mileage allowance from their taxable income may not also deduct cost other motor cost, such as the cost of purchasing the vehicle, interest on a car loan, MOT, servicing, tax or fuel costs. Motor costs which are not related to miles travelled such as parking, toll charges and the congestion charge are tax deductible in addition to the mileage allowance.
Comments
The mileage allowance limit is per fiscal year (to 5 April.)