Approved mileage allowance payments
The Government has increased the rates for approved mileage allowance payments for cars and vans from 40p per mile to 45p per mile on the first 10,000 miles of business travel a year. The rates for mileage incurred above 10,000 miles will remain unchanged at 25p per mile. As well as the increased allowance rates, the current additional allowance of 5p per passenger per mile will be extended to apply to volunteers as well as employees. Those drivers who receive less than the approved allowance rates will be entitled to claim additional relief as a result of these increased rates.
Who will be affected?
These allowances can be claimed by employees who use their personal cars or vans for business travel and by employers who reimburse employees for such use. Volunteers who carry passengers as part of their volunteering will also benefit from the 5p per passenger per mile allowance.
The increased mileage allowance payment rates take effect from 6 April 2011.
Together with the planned changes to fuel duty, these increased rates will be a welcome relief to employees using their cars or vans for business travel.