Motorcycle Mileage Claims - Umbrella

[dsloper]

Hi.

I was wondering if anyone can help. I have just started contracting and working under an umbrella company.

My umbrella company (as per tax rules) requires a receipt for £13 for every 100 miles travelled.

The problem I have is that my bike petrol consumption is around £10 per 100 miles, therefore I cannot physically fill up this amount.

As an example, I filled up Monday night before starting my contract Tuesday morning at a cost of £21.04. I then did 60 miles per day for 3 days before needing to fill up. However, umbrella require a receipt for £23.40 so therefore their system will only allow me to use the £21.04 receipt for 2 days, not 3.

I have no way of physically being able to get enough petrol in my bike so that I have enough reciepts to cover unless on top of my 60 miles return journey I then do 50 miles every 2 days personal mileage on top of this to use more fuel - something I do not really feel like doing once home from work.

Can anyone help explain this process? I cannot see how the government can set limits when vehicles cannot meet this requirement.

Thanks

<Name removed for modesty's sake> (Sorry new here, so please be gentle)

[kingcook]

My umbrella company (as per tax rules) requires a receipt for £13 for every 100 miles travelled.

The problem I have is that my bike petrol consumption is around £10 per 100 miles, therefore I cannot physically fill up this amount.

Have you tried speaking to the umbrella co?

I had these limits when i was with a brolly, but i was driving a car so no problem there.

Why not start your own Ltd Co? You won't have to put up with these rules.

[northernladuk]

i thought that was for cars that are on 45/25p a mile and have low feul consu ption. you are only claiming 24p (has it changed for 2011?) and do much higher mpg so the original sum for cars will not work.

Have you asked you umbrella for clarrification or searched HMRC/web?

[dsloper]

The umbrella company portal states the abolve values for motorcycles above 600cc (mine is 650cc) and has different values for cars (i think £18 per 100 miles for a 1.8 for example)

Yes I am only claiming 24p per mile but they will not let me claim as their system requires the receipts of £13 per 100 miles 'as per HRMC requirements since July 1st 2011' as they put it.

This is my first week, so not been able to contact them yet as I could only enter fuel after the timesheet, but their T+C's do state you have to fall in will HRMC requirements.

Seems strange to me that in effect HRMC guidelines say I would have to get a bike that is poorer on economy, and hence worse for the environment to be able to claim.

Have not gone limited yet as plan to see how the contract market goes for me after the initial 3 months.

Thanks

Darren

[Fred Bloggs]

And I thought a brolly was supposed to be 100% hassle free. This is another reason to run your own Ltd Co as far as I can see. The HMRC mileage rates are supposed to cover more than just the petrol you put in the vehicle. (45p and 25p doesn't cover the real cost of driving, but that's another story).

[Wanderer]

Seems strange to me that in effect HRMC guidelines say I would have to get a bike that is poorer on economy, and hence worse for the environment to be able to claim

As for the rules being stupid, the rule says 24p/mile - it says nothing about the fuel consumption so it is the same rate if you ride a 50cc scooter or a 2300cc Triumph Rocket. The ones being unreasonable are the Umbrella company who are insisting that you couldn't do more than 47 MPG on a >600cc bike.

Do you have a car that you can put petrol into to get some receipts? Or maybe you should thrash the bike a bit harder?

[Greg@CapitalCity]

So weird

Its probably linked to the new HMRC fuel advisory rates effective from 01 June 2011. These rules state the price of fuel used where drivers of company cars want to pay for their own private fuel (to a avoid a benefit-in-kind charge). However, they also get used when employees use their own vehicle, and put a claim in for mileage - like you for example.

The calculation allows for the employer (or Umbrella) to claim back a certain amount of VAT from the mileage claim. If your umbrella are limiting your claim to 13p per mile, then you should certainly express your dissatiscation - they are leaving you out of pocket simply so that can reclaim the maximum amount of VAT on the mileage claim. This is an internal process for them and while there is no financial benefit for you in them reclaiming the VAT, it will help them out.

I don't know where they get 13p a mile from - I would have thought it would be 15p per mile. See HM Revenue & Customs: Travel - mileage and fuel allowances

So the bottom line is;
(1) You should be able to claim 24p a mile - this is a given, and if your Umbrella refuse then fight hard (if you have the energy);
(2) If you can only give your Umbrella fuel receipts of £10 per 100 miles so be it. This only affects their ability to reclaim VAT on the mileage allowance paid. Wanting to to maximise their profits at the expense of your tax deductions is not good for you!

[Sockpuppet]

Agree with Greg nothgin to do with HMRC but everything to do with VAT claiming.

[Fred Bloggs]

The problem is, that sometimes it doesn't matter so much if you're right. I have found when dealing with agencies (and I expect a brolly to be the same) that if they refuse point blank to pay you, they know there is nothing you can do other than write it off as irrecoverable debt because the amount of money is pretty small and you can't afford to take action for a small sum. I know this to my cost when an agency refused to pay VAT on an expense claim. In this case, I'd swap brollies or start my own Ltd Co.