HMRC Mileage Allowance Payments

HMRC Mileage Allowance is the simplest method for claiming business-related vehicle expenses in the UK. This method provides a fixed mileage rate that you can use to claim or deduct all business mileage. Parking fees, toll and/or congestion charges may be claimed in addition to business mileage. Use this program if you are an employee or self-employed and have minimal to moderate vehicle expenses.
Certain conditions apply when choosing this program.

About this program

Using the Mileage Allowance program, each trip logged and classified as #business (or hashtag linked to a mileage rate) is expensed using HMRC's flat-rate per-mile.

The mileage rate incorporates all fixed and variable expenses associated with owning and maintaining your vehicle, except for parking, toll and/or congestion charges. No other expense logging is required or allowed with this program.

How to use this program

Select the HMRC Mileage Allowance program for a vehicle you personally own or lease. You cannot use this program with a vehicle owned by the business (i.e. company car).

The Mileage Allowance method is the simplest to use when reimbursing vehicle expenses, because it requires the least amount of input and administrative overhead.

How this program works

When you select this program within Psngr app:

▪︎ Trips are logged (automatically) and expensed using the standard #business mileage rate. We keep this rate up to date with the latest HMRC publications. It does not matter if you use more than one vehicle in a year - it’s all calculated together.

▪︎ Expenses for parking, toll charges, and congestion charges can be logged separately. Other expense categories are disabled in the app.

▪︎ Reports include sections for “Trips”, “Expenses” and “Vehicles” section, each with a list of the items logged in the report period and a summary.

▪︎ Report Rules - by default, reports generated by this program are not restricted to a single vehicle. For example, if you use two vehicles, and selected the Mileage Allowance program for both of them, your report will include both vehicles. The total tax-deductible amount in the report will be based on the mileage logged with both vehicles combined. You can change this behavior by selecting a specific vehicle in your report rule.

Conditions

• You must own the vehicle personally, i.e. purchased or leased on your own name and not owned by the company.
• If you are using Mileage Allowance, you cannot claim separate costs for fuel, repairs, insurance, or depreciation.
• Fines can not be claimed as business expense.
• Approved Amount: this is the maximum amount you can claim for business mileage in a year. It is based on HMRC rate-per-mile and you can claim or reimburse this amount without reporting to HMRC. If you claim more than the approved amount, you must report this to on form P11D and pay income tax on any amount above the approved amount.
• Once this method is chosen, it must be used consistently for that vehicle.

MAP rate is not allowed

You can’t use this program if you:

• Used other deduction method for your vehicle in the past, for instance if you've used the "Actual Expenses" method to claim expenses for the same vehicle

• Your employer reimburses the fuel expenses for the vehicle.

Disclaimer

Psngr does not provide tax, legal or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, nor should be relied on for tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors.

Source: HMRC Expenses & Benefits MAP