This was the original answer to your question: ""Mileage rates are 45p up to 10,000 miles and 25p for mileage which exceeds 10,000 miles".
You must use these rates to calculate the approved amounts of payments to your employees.
If you make payments that exceed the approved amounts then you must:
• report the excess payments on form P11D
• add anything above the ‘approved amount’ to the employee’s pay, and deduct and pay tax as normal
Please see the guidance on the gov.uk website at:
Expenses and benefits: business travel mileage for employees' own vehicles
The company’s employee costs, which comprise the gross wages and employer’s NICs, are tax deductible expenses for corporation tax purposes"".
The mileage rates that can be paid include allowances for wear and tear, maintenance and depreciation.
If you pay above that rate, tax must be deducted and a P11D completed.
If you don't pay the approved rates, then you must keep a record of business mileage and also apportion running costs according to the business/private use of the vehicle and report this on the P11D.
The employee can claim expenses incurred wholly, exclusively and necessarily in the course of their duties.
For more information about PAYE requirements, please contact the PAYE team.
Details are on the GOV.UK website. The helpline is 0300 200 3200.