Budget 2011 – Approved mileage allowance
In his Budget report, chancellor George Osborne announced that the approved mileage allowance payments rates for an employee using their own car on a business trip will rise to 45p per mile (from 40p) for the first 10,000 miles from 6 April 2011.
This is the first increase since April 2002 and will be welcomed by employees who use their own car for work. The approved mileage rate for employees for mileage beyond 10,000 miles remains at 25p per mile.
Where an employer pays less than the published rates, employees can make a tax relief claim for the shortfall using mileage allowance relief.