Business Mileage Rate - 25p/40p

[MarillionFan]

Remember that the 10,000 rate of 40p starts at the start of each new tax year AND each new employment.

So if you have been with a brolly and then start your own company, you can claim the first 10,000 with your limited company at 40p per mile.

This can be worth remembering!

Alan

So I run more than one company.

I am self employed for a retail business and I am LTD for contracting. Both are very distinct.

I visit my retail business every day. 4 miles and then every week I drive 80 miles to a supplier. Plus shows. I do about 8000 miles per year.

During the week, I contract and travel. I do approx 10000 miles per year.

Can I assume 40p x 8000 and also 40p at 10000 miles as these are seperate employments?

[amcdonald]

Can I assume 40p x 8000 and also 40p at 10000 miles as these are seperate employments?

No it's 10,000 miles you can claim. multiple employments make no difference

Technically even permies can claim it from Hector if they're employer doesnt reimburse them

[Clare@InTouch]

No it's 10,000 miles you can claim. multiple employments make no difference

Technically even permies can claim it from Hector if they're employer doesnt reimburse them

According to HMRC:

If you work for different employers

If you have two or more employers which are independent of each other, you're due the higher mileage rate for business mileage in each job.

HM Revenue & Customs: Tax relief for business mileage or fuel

[Sockpuppet]

Technically even permies can claim it from Hector if they're employer doesnt reimburse them

They can claim the tax back.

So if they get paid 20p per mile and the allowance is 40p they can claim a tax refund on the difference of 20p. Around 4p.

[BoredBloke]

The 25p level is a con. If you have a diesel that does 50mpg that's about 10 miles per litre. Those 10 miles would generate £2.50. Take away the £1.30 you pay for the fuel and you get £1.20 to pay for all the other motoring costs!

If you own 2 cars for you get 2 lots of 10k allowences? I suspect not!!

[escapeUK]

The 25p level is a con. If you have a diesel that does 50mpg that's about 10 miles per litre. Those 10 miles would generate £2.50. Take away the £1.30 you pay for the fuel and you get £1.20 to pay for all the other motoring costs!

If you own 2 cars for you get 2 lots of 10k allowences? I suspect not!!

Someone else who has not understood that all you get *extra* is the tax you would have paid, if you had paid this as dividend rather than expense. Sigh.

[MarillionFan]

According to HMRC:

If you work for different employers

If you have two or more employers which are independent of each other, you're due the higher mileage rate for business mileage in each job.

HM Revenue & Customs: Tax relief for business mileage or fuel

Last question.

Does this go on your self assessment as well as your LTD accounts or only against the LTD as an expense.

[SimonMac]

Rather than start a new thread with a few questions I hope the OP doesn't mind me hyjacking to clarifiy a few things.

1) The 10,000 limit would run my personal Tax year rather than the companies accounting year?

2) Is there any requirements for what needs to be recoreded on your own company mileage form, I assume as long as it has the date, the start and end destinations and the miles covered everything else is irrelevent?

3) How do I record that I have paid myself the money, in the past its always been on my wage slip, but I am not planning on taking a salary for the first few months until I am up and running.

TIA

[SimonMac]

No worries. Its b.

So 10000 x £0.40 to MF = £4000. That is sorted and correct.

You have a 2000cc Petrol car so fuel element is: 15p per mile (changed every 6 months, next change march 1st).

So 10000 x £0.15 = £1500

VAT on £1500 is £300.

You only need to keep £1500 worth of petrol receipts, not receipts for all the fuel you buy.

As for recording it if you use sage or another accounting program I'd do 2 entries.

£1500 Fuel Element Of Mileage @ 20% VAT
£2500 Non Fuel Element of Mileage @ 0% VAT

otherwise just do £4000 with vat of £300 = 7.5% VAT. You could do that if you used an accounting program but it'll probably winge if the vat is not 0%, 5% or 20%. Also good to show what fuel element of miles claimed is.

Sockpuppet

Didn't know about this bit, I assume this would only be able to for those not on falt rate when it comes to VAT?

[Sockpuppet]

Didn't know about this bit, I assume this would only be able to for those not on falt rate when it comes to VAT?

I'm not on flat rate VAT so don't know