Wear & Tear Allowance

Alicia
Alicia Registered Posts: 40 Regular contributor ⭐
in General accounting discussion
Hi everyone

The directors of the limited company where i work use their personal cars to do in excess of 30,000 miles a year. They claim the usual 45p for the first 10,000 miles and then 25p for the remainder.

Due to the cost of fuel increasing, the element of wear and tear on this allowance is not covering the cost of tyres, servicing etc.

Are there any other allowances for wear and tear? Could the company pay for such servicing and tyres or am i just wishful thinking?

Many thanks

Alicia

Comments

  • Dcollins
    Dcollins Registered Posts: 179 Dedicated contributor 🦉
    The company can pay an additional car allowance. But it would be subject to PAYE and class 1 NIC, and should be added to their payslip in the same way as their usual salary.

    If the company pays for servicing or tyres, it's still taxable, would need to be grossed up and tax & NIC paid.

    Quite a common bugbear these days.

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