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The HMRC AMAP rates for 2019-20 are in. The rates apply for any business journeys you make between 6 April 2019 and 5 April 2020. They’re identical to the rates that applied during 2018-19. In fact, the last time AMAP rates changed was in April 2012, when the AMAP rate for the first 10,000 car and van miles rose from 40p per mile to 45p per mile.
If the drive is for business purposes, you can claim tax back from HMRC. With this in mind, here’s a definitive look at the UK’s business mileage-allowance rates for 2019-2020. We’ll also show you how to calculate your mileage deduction.
Did you know, you can also claim an extra 5p per mile if you have a passenger with you on a business drive. Just set up a custom purpose in MileCatcher for such rides.
You can claim a business mileage allowance using AMAP rates if you:
A journey counts as business travel if:
The following DO NOT count as business journeys:
With that out of the way, let’s take a more in-depth look at AMAP rates.
AMAP rates cover the cost of running and maintaining your vehicle. This includes:
AMAP rates DON’T cover:
You can claim tax back on these expenses in addition to the AMAP rate if you can show you’ve made them ‘wholly and exclusively’ for business purposes. This means:
To calculate your business mileage deduction, you’ll need to keep a log of all your journeys (MileCatcher mileage tracker makes keeping a log super simple).
Once you have this information in hand, calculating your business mileage deduction is very straightforward.
Let’s say you’re self-employed. Your total taxable profit (your income after deducting allowable expenses) is £40,000.
You’ve travelled 14,000 miles by car. 3,000 were personal journeys and the remaining 11,000 were business-related.
So, you’d calculate your mileage deduction as follows:
Now, let’s say you’re an employee. You’ve racked up 10,000 in business mileage on your personal car. Your boss reimburses you at a rate of 35p per mile.
In this case, you can claim tax back on the difference, which is 10p per mile.
This means you can deduct £1,000 from your taxes (10,000 multiplied by 10p).
Claiming your mileage deduction is easy. If you’re self-employed, include the mileage deduction in your self assessment tax return. If you’re employed, you can claim using Form P87. Do note, however, that you’ll have to file a self assessment tax return if you’re claiming more than £2,500.
HMRC’s business mileage rates don’t apply to company cars. A company car is a vehicle that:
HMRC considers a company car to be a benefit-in-kind. This means you can’t claim a mileage deduction on your tax return. Instead, you actually pay tax on the car.