Car and Van Mileage Allowances

HMRC approved mileage allowance payments (AMAPs) can be paid tax and NI free to employees using their own cars, motorcycles or bicycles for business as shown in the table below:

Vehicle type   Amount per mile
Cars and vans, mileage up to 10,000 45p
Cars and vans, mileage up to 10,000 (for NI the rate is 45p for all business miles) 25p
Motorcycles, all mileage 24p
Bicycles, all mileage 20p
Passenger (car or van, per passenger) all mileage 5p

 

Advisory Fuel Rates

Where an employee pays for all the fuel when driving a company car, the employer may reimburse them tax-free for the cost of business mileage travelled at the rates shown in the table below.  Similarly, where an employer has paid for all the fuel for a company car, the employee can avoid being subjected to fuel scale charge (see above) by reimbursing the employer using the same rates.

The rates below apply from 01 June 2020 but may be amended at any time, but usually quarterly, by HMRC to reflect fuel prices.  The previous quarter’s figure are shown in brackets.

Engine size Petrol LPG
Up to 1,400cc 10p (12p) 6p (8p)
1,401 to 2,000cc 12p (14p) 8p (10p)
Over 2,000cc 17p (20p) 11p (14p)

 

Engine size Diesel Electric
Up to 1,600cc 8p (9p)
1,601 to 2,000cc 9p (11p)
Over 2,000cc 12p (13p)
N/A 4p

 

If you would like to discuss your car policy, please contact us on 01752 752210.