Mileage Allowances

For Employees Using Their Own Transport The approved maximum tax and national insurance free mileage allowances for employees using their own transport for business are as follows: Flat Rate First 10,000 Miles Miles over 10,000 Car 40p 25p Motorcycle 24p 24p Bicycle 20p 20p Income Tax and NICs are due when allowances exceed these rates. Employees can claim tax relief on any shortfall. Rates of up to 5p per mile, per passenger, are also tax and NIC free when paid for the carriage of fellow employees on the same business trip.

Fuel-Only Mileage Rates HMRC advisory mileage rates as at March 2007 for employee private mileage reimbursement or employer reimbursement of business mileage are:   Petrol Diesel LPG Up to 1400cc 9p 9p 6p 1401cc - 2000cc 11p 9p 7p Over 2000cc 16p 12p 10p Income tax and NICs may be due on higher rates and tax relief may be due on lower rates.