Like many industries, there are some people working in financial services who need to use their personal vehicles for business reasons. For some, this could mean travel to a conference or meeting, whereas there will also be those who work for a firm which offers visits to people in their homes, perhaps for clients who are unable to travel themselves or those who are elderly or infirm.
In circumstances such as these it is reasonable to expect to be reimbursed by your employer and this is usually done as standard in organisations where employees often use their own transport for company business. It is important to note that reimbursement for travel between an employee’s home and their regular place of work is not usually granted, unless the employee’s role is defined as being home-based both in their contract and in the eyes of HM Revenue & Customs.
For the purposes of income tax calculations, if a financial services employee is being reimbursed for their use of a vehicle that they own they are not liable to pay tax on this unless the payments they receive exceed the amount allowed by Her Majesty’s Revenue and Customs.
Instead of expecting tax payers to keep details of every single penny they spend on the upkeep and maintenance of their car as well as their fuel costs for every single journey they take, HMRC allows 45 pence per mile to those who are using their own vehicle for travel on company business.
However, this does not apply to journeys that you would normally have to make. For example, if you normally commute 10 miles to work, but instead have to attend a meeting which is 50 miles in the opposite direction then the maximum mileage claim that you should make is the difference between the miles you have travelled and the distance that you would travel normally.
In this instance, this means that you would be able to claim tax relief on a 40 mile journey as opposed to the full 50 miles. If you think that this rule may apply to you then you will need to keep a record of the details of your mileage and payments in order to ensure that you comply with the relevant rules.
Use our free calculator to find out how much income tax you could be entitled to reclaim.Calculate Tax Rebate