Car mileage allowances slashed by 50 per cent.
Position | New Board of Inland Revenue policy - Brief Article |
The Inland Revenue is planning to cut 50 per cent off car mileage allowances for all staff following a large-scale opt-out of company car schemes by employees.
Staff who use their car for their employer's business can currently claim tax relief either on the actual costs they incur or, under a simplified scheme, at mileage rates based on published average costs of motoring, ranging up to 63p per mile. From April 2002, the rate will be slashed to just 40p per mile for the first 10,000 miles and 25p thereafter, regardless of the size of car or the actual cost of running it.
The change does not affect people who are self-employed, who can continue to claim relief on the actual costs of running a car.
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