Most drivers can claim a tax free allowance from their employers if they use their car for work. When they do, HMRC recommends that this is done at 45 pence per mile (in 2009-10 the rate was 40 pence per mile), although many employers pay less than this.
But the TPA has discovered, that most councils have been paying well above the HMRC rate – paying as much as 65 pence per mile for a 1.2 litre engine car. That's a huge difference.
Lancashire paid out the most in mileage allowance payments in 2009-10 – a total of nearly £8.8 million.
My comment: Whilst staff should be reimbursed for using their car on official business why are some councils paying 25p a mile more than other councils? However, it could be worse, Surrey Police for example also pay mileage allowance for staff to travel to and from work as a extra perk.
I wonder if the HMRC are taxing council staff for their 'above the HMRC advised rate' mileage allowance and Surrey Police staff for their 'private mileage perk' as they should be doing?
Read the full story from the source Taxpayer's Alliance
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