I currently receive a reasonably generous car allowance, paid monthly on top of my salary, and taxed as income at the going rate. (Odd already?) On top of this allowance, I expected to receive a pence-per-mile mileage rate based upon the work journeys I make (sales calls).. but No, nothing.
Is it unusual to receive a flat-fee car allowance without any mileage component? Strikes me as odd. Are my HR department pulling a fast one on me?
|
|
Allowance + say 15p per mile would be what I would expect - my last employer was £423/mth + 25p = good scheme
|
You should expect both, although my employer in the UK uses HMRC mileage rates which are intended to (barely) cover fuel costs and are (now) capped at 2.0l cars, more like 11p / mile.
In the UK you can also (then) claim the tax on the difference between the HMRC approved 'fully funded' rate (more like 45p) and what you receive - provided it's your own car that is, this can be significant.
I guess NZ will have its own tax rules.
|
- My employment contract is drawn-up by a HR team based in the UK who are understandably not aware of any NZ tax implications, so tax is admittedly my issue to investigate...
But I do expect them to know that a mileage rate - even "only" 11p/12p is payable and I'll be asking them why they have omitted this?! (Trying to con me presumably). I just want to be sure that some kind of mileage component is the expected norm and that their actions are out of line!
How could a flat-rate car allowance work under any circumstance, when for example 2 identically-paid sales reps could have different territories and one ends up driving much more than the other, and his mileage starts to cost him..?!
|
|
Do they pay for your fuel?
|
- Nope, they don't pay for fuel either. Strike you as odd?
I suppose that they will try to claim that my fuel/mileage costs are to be taken out of the car allowance they are paying me, but is this usual or fair?
|
|
It's just part of what you can negotiate with your employer - there is no statutory requirement for them to even offer a car allowance if you agree that as part of your terms of contract - what does that say, it will be the arbiter in these matters.
|
In my previous company I felt a bit hard done by. All over a certain grade were eligible for car or allowance (approx £425 pm IIRC), most took allowance. Also got a fuel card for all motoring (private and work) at no cost, other than tax on private use petrol.
I was a moderately high business user (c 20k per year) and felt that I should have had a bit more towards my running costs than those who just commuted home to office.
These days, much as I wish I didn't have to, I'm just grateful for a job!!
Current employer paid me 20p a mile which probably barely covered fuel, let alone anything else, so I've manage to negotiate that up to 30p. Also intend to claim the difference up to 40p per mile from the Revenue.
(Zero posted at the same time, which reminded me that I used to claim mileage less fuel cost against tax)
Last edited by: smokie on Fri 24 Sep 10 at 08:53
|
>> I currently receive a reasonably generous car allowance, paid monthly on top of my salary,
>> and taxed as income at the going rate. (Odd already?)
Nope - that's standard, car allowance is taxed at your prevailing rate. (company cars are taxed so the allowance is too)
On top of this allowance,
>> I expected to receive a pence-per-mile mileage rate based upon the work journeys I make
>> (sales calls).. but No, nothing.
>>
>> Is it unusual to receive a flat-fee car allowance without any mileage component? Strikes me
>> as odd. Are my HR department pulling a fast one on me?
Yes that bit is odd, you should receive a 0.x$ per mile for buisiness mileage at a very minimum
I don't know Kiwi tax laws, so is it possible to deduct 0.X$ per mile from your tax bill?
|
|
Surely, as Richard has said, each company will be different and down to the individual to negotiate? I can't think of anywhere its written down that ALL companies have to pay a mileage allowance!
|
|
My employment contract makes no mention of a mileage component or claim-able fuel costs, so I haven't signed it yet whilst I investigate the strength of my position! 11 weeks later and HR still haven't come back to me or chased up my contract, so I'm about to up the ante! Have driven over 3000 business miles to date...
|
Are you working again Nick?
Has that two years of laying about on beaches come to an end?!
|
|
Mine is monthly car allowance plus 15p per mile for petrol. Those without a car allowance get 45p per mile.
|
|
Haven't been on a company milage scheme for many years. Do however remember the good old days 30yrs ago with a casual user rate of 37p/mile and no tax worries back then. I was quite a high mileage user of the casual scheme and it was like another salary. That's why in my early 20s I was running stuff like a Citroen DS, then CXs and Saab Turbos when the bosses had company Cavaliers. Happy days.
|
Not having the mileage paid for does seem odd - and wrong IMO. How can you be expected to cover these costs?
Makes me realise the allowance I could get if I opt out of the scheme is quite generous now - £525pm before tax.
|
Is there anyone else, longer standing, in the same position/job as you in the company?
If so, is it worth a chat with them?
|
|
I'm the only employee based in this country. My Aussie colleagues don't get paid mileage either but they get a reasonable tax-break at the end of the year based upon the Kms they've driven...
|
I would have assumed that NZ tax rules are similar to those in the UK and Aus.
you get a revenue approved xx per mile tax break.
Last edited by: Zero on Fri 24 Sep 10 at 11:45
|
It seems that the UK based HR department don't have a clue about how the NZ tax laws would work.
Hence I think you have somebody int HR who is trying to look professional but is floundering in the dark.
Oh, look what I just found ;)
www.ird.govt.nz/business-income-tax/expenses/mileage-rates/
Enjoy ;)
|
>> I'm the only employee based in this country. My Aussie colleagues don't get paid mileage
>> either but they get a reasonable tax-break at the end of the year based upon
>> the Kms they've driven...
>>
OK, so HR obviously think you get the same.
If that's wrong then you need to let them know.
|
Car allowance but no mileage rate paid? - Falkirk Bairn
