HMRC figures reveal the number of grey fleet drivers being paid more than the Government-approved mileage rate has more than halved.

The data shows that 550,000 people were being paid more than the Approved Mileage Allowance Payment (AMAP) rate in 2007/08, but by 2014/15 that had fallen to 250,000.

Alastair Kendrick, tax director at MacIntyre Hudson, believes tighter controls on business travel, the use of pool cars, an increase in salary sacrifice cars and some public sector bodies cutting mileage rates so that they now reflect AMAP rates have all helped.

The number of recipients of taxable excess mileage allowance payments held steady until 2009-10, with a slight fall in 2010-11 from 550,000  to 510,000 and then a much larger one (to 380,000) in 2011-12.

From April 2011, the AMAP rate was increased from 40p to 45p, which also meant that employees who had been receiving AMAPs at a rate of between 40-45p no longer needed to report their benefit, or pay tax or NICs on it.

 

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