Using your vehicle for work related journeys

Posted on 9th January 2024 by Streets -  Employee Benefits


Image to represent Using your vehicle for work related journeys

If you use your car or other vehicle to undertake business journeys on behalf of your employer, and your employer does not:

  • Fully reimburse you for the business use, or
  • Reimburses you but at a lower rate per mile than the approved HMRC rates (see below).

Then you may be able to make a claim to HMRC and reduce your overall tax bill.

HMRC’s notes on this topic are reproduced below:

Vehicles you use for work

You may be able to claim tax relief if you use cars, vans, motorcycles or bicycles for work.

This does not include travelling to and from your work unless it’s a temporary place of work.

How much you can claim depends on whether you’re using:

  • a vehicle that you’ve bought or leased with your own money
  • a vehicle owned or leased by your employer (a company vehicle)

You can claim for this tax year and the 4 previous tax years if you’re eligible.

Using your own vehicle for work

If you use your own vehicle or vehicles for work, you may be able to claim tax relief on the approved mileage rate. This covers the cost of owning and running your vehicle. You cannot claim separately for things like:

  • fuel
  • electricity
  • vehicle tax
  • MOTs
  • repairs

To work out how much you can claim for each tax year you’ll need to:

  • keep records of the dates and mileage of your work journeys;
  • add up the mileage for each vehicle type you’ve used for work; and
  • take away any amount your employer pays you towards your costs, (sometimes called a ‘mileage allowance’).

Approved mileage rates

 

First 10,000 business miles in the tax year

Each business mile over 10,000 in the tax year

Cars and vans

45p

25p

Motorcycles

24p

24p

Bicycles

20p

20p

Using a company car for business

You can claim tax relief on the money you have spent on fuel and electricity, for business trips in your company car. Keep records to show the actual cost of the fuel.

If your employer reimburses some of the money, you can claim relief on the difference.

How to claim

If you complete a self-assessment tax return, you must claim through your tax return instead.


No Advice

The content produced and presented by Streets is for general guidance and informational purposes only. It should not be construed as legal, tax, investment, financial or other advice. Furthermore, it should not be considered a recommendation or an offer to sell, or a solicitation of any offer to buy any securities or other form of financial asset. The information provided by Streets is of a general nature and is not specific for any individual or entity. Appropriate and tailored advice or independent research should be obtained before making any such decisions. Streets does not accept any liability for any loss or damage which is incurred from you acting or not acting as a result of obtaining Streets' visual or audible content.

Information

The content used by Streets has been obtained from or is based on sources that we believe to be accurate and reliable. Although reasonable care has been taken in gathering the necessary information, we cannot guarantee the accuracy or completeness of any information we publish and we accept no liability for any errors or omissions in material. You should always seek specific advice prior to making any investment, legal or tax decisions.


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