NIM05701 | Class 1 NICs: Expenses and Allowances: Mileage allowances: Introduction

In broad terms, mileage allowances fall into two main categories:

• payments aimed at covering a range of expenses connected with motoring. These are normally paid to those employees who are required to use a privately owned car for business travel, see NIM05702

• payments only for fuel. Employers may pay these to employees who use vehicles the employer provides, see NIM16175; or they may pay them to employees who use a privately owned car for business travel, see:

• NIM05708 for payments made before 6 April 2002; and

• NIM05800 for payments made after 5 April 2002.

Where, unusually, an employer pays a mileage allowance to an employee wholly for private travel, see:

• NIM05708 where the car is privately owned for payments made before 6 April 2002

• NIM05800 where the car is privately owned for payments made after 5 April 2002

• NIM16175 where the employer provides an employee with a car.

The definitions and rules applied to determine qualifying business travel, including business mileage, are the same for both tax and NICs, see EIM32015.