Mileage allowances

It is quite normal practice for employees to be reimbursed at a reasonable mileage rate for business use of their own vehicles. 

A statutory system of Approved Mileage Allowance Payments (AMAPs) applies for employees using their own vehicles for business journeys, as follows:

Vehicle type Per mile
Car/van first 10,000 miles in the tax year 45p
- Car/van each additional mile above 10,000 25p
Motorcycles 24p
Bicycles 20p

Unless the employee is reimbursed at a rate higher than the AMAP, the payments do not need to be reported on a P11D. If the employer pays less than these rates, it is possible for the employee to claim income tax relief for the shortfall.

Rates of up to 5p per mile, per passenger, are also tax and NICs free when paid for the carriage of fellow employees on the same business trip. This now covers volunteers who drive for hospital car services etc, even though they are not strictly employees.

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Davis Bonley, Northside House, Mount Pleasant, Barnet, Hertfordshire EN4 9EE , Davis Bonley is a trading name of Davis Bonley Limited, Northside House, Mount Pleasant, Barnet, Herts EN4 9EE. Company registration number 08989322. Regulated as auditors and regulated for a range of investment business activities by the Association of Chartered Certified Accountants. Awarded approved employer status for Association of Chartered Certified Accountants trainee and practising certificate development.

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