Mileage reimbursement in UK

When you are using your own vehicle for business purposes in the UK, you are entitled to mileage allowance. Either you can get mileage allowance from your employer og get a tax relief (MAR) from the HRMC.

Needed documentation

"You need to keep records of dates, mileage and details of all work journeys. Your employer needs this information to make expenses payments to you. You also need them to get any MAR"

- HMRC.gov.uk

So, at basic you need to keep track of which dates you drove how far, and details such as start and stop destination to prove that you were not driving between private addresses, or have been driving between home and your permanent work place. Both the mentioned situations are situations where you are not entitled to mileage allowance.

What counts as business mileage?

In general all mileage that you travel doing your job is considered business mileage. It can include travel to a temporary workplace, but does not include;

  • normal travel between your permanent workplace and home (or anywhare that is not a workplace)
  • All private travel

Mileage Allowance Relief (MAR)

MAR is a supplement to the mileage allowance if you either;

  • get no mileage allowance from your employer
  • get less than the approved mileage allowance rate

The MAR is given as a tax relief from the UK government.

You can calculate the ammount you are entitled to by taking the payments from your employer and compare it with the mileage allowance calculated by our software, or by calculating how much you could have received by multiplying the approved mileage allowance rate by the driven miles. If you have been payed less than the result, then you are entitled to MAR.

Approved business mileage rates

From 2011/12

First 10,000 business miles in the tax year

Each business mile over 10,000 in the tax year

Cars and vans

45p

25p

Motor cycles

24p

24p

Bicycles

20p

20p

Older rates

From 2002/03 to 2010/11

First 10,000 business miles in the tax year

Each business mile over 10,000 in the tax year

Cars and vans

40p

25p

Motor cycles

24p

24p

Bicycles

20p

20p

 

How to get tax relief

"To find out how you can get tax relief for your business mileage or fuel read the guide 'How to get allowances and reliefs - employees or directors'.

If you haven't completed a tax return you've got five years from the 31 October following the end of the year concerned to get the relief. If you've previously completed a return it's five years from 31 January following the end of the year concerned."

- HMRC.gov.uk