THE Inland Revenue has frozen Fixed Profit Car Scheme mileage rates for the third year running, it was announced this week. The authorised mileage rates - the maximum tax-free reimbursement for employees using their own cars on company business - for 1999/2000 are unchanged from both 1997/98 and the current financial year.

With the Government committed to increasing duty on fuel by 6% above inflation in each Budget coupled with an annual inflation rate of 3.1% and falling residual values the real cost to drivers of using their own cars for business is dramatically increasing. The pence per mile rates are based on a proportion of the routine costs - depreciation, servicing, insurance and road tax - and all running costs - such as fuel - attributable to the business miles travelled.