- Original Poster
- #1
The benefits and expenses policy section of HM Revenue & Customs have been looking this year at potential changes to the mileage allowance businesses can claim as an alternative to vehicle running costs.
The main rate of mileage allowance was fixed in 2002-03 at 40p per mile for the first 10,000 miles and 25p per mile thereafter. Despite severe and persistent rises in fuel costs I was quite shocked to see a discussion document this week where it is suggested the rates may change.
The suggested new rates - final decision hasn't been taken yet as far as I am aware are that the rate may increase to around 50p for the first 2,000 miles, stay at 40p for the next 4,000 miles and drop to 20p or 25p thereafter.
There are a number of factors still to be resolved such as tying the rate paid into the vehicle emissions etc.,
Based upon someone doing 10,000 miles a year those figures could mean instead of being able to claim £4,000 p.a. next year the claim may only be £3,400 resulting in an increase in tax of over £100 for claimants.
This also affects employees who if they are paid a mileage allowance by their employer of less than the current rate can claim tax relief on the difference.
That is why the post was labelled Stealth Tax or Robbery.
I have a vision of Alistair Darling announcing next March that the mileage rate is to be increased for low CO2 emission vehicles from 40p to 55p to help small businesses when the small print is going to be yet another blow for small businesses and employees who do business journeys.
How long can this government get away with announcing a tax giveaway while they are stealing the money straight out of our pockets.
Reducing tax reliefs when they haven't been increased for 5 years to reflect the increased vehicle costs. If they applied the same rules to their own extravagant expenditure we could have an efficient education and health service.
Might be an idea to copy this post everywhere to raise the profile of this issue before it becomes law.
The main rate of mileage allowance was fixed in 2002-03 at 40p per mile for the first 10,000 miles and 25p per mile thereafter. Despite severe and persistent rises in fuel costs I was quite shocked to see a discussion document this week where it is suggested the rates may change.
The suggested new rates - final decision hasn't been taken yet as far as I am aware are that the rate may increase to around 50p for the first 2,000 miles, stay at 40p for the next 4,000 miles and drop to 20p or 25p thereafter.
There are a number of factors still to be resolved such as tying the rate paid into the vehicle emissions etc.,
Based upon someone doing 10,000 miles a year those figures could mean instead of being able to claim £4,000 p.a. next year the claim may only be £3,400 resulting in an increase in tax of over £100 for claimants.
This also affects employees who if they are paid a mileage allowance by their employer of less than the current rate can claim tax relief on the difference.
That is why the post was labelled Stealth Tax or Robbery.
I have a vision of Alistair Darling announcing next March that the mileage rate is to be increased for low CO2 emission vehicles from 40p to 55p to help small businesses when the small print is going to be yet another blow for small businesses and employees who do business journeys.
How long can this government get away with announcing a tax giveaway while they are stealing the money straight out of our pockets.
Reducing tax reliefs when they haven't been increased for 5 years to reflect the increased vehicle costs. If they applied the same rules to their own extravagant expenditure we could have an efficient education and health service.
Might be an idea to copy this post everywhere to raise the profile of this issue before it becomes law.
