SolvedNIM05801 | Class 1 NICs: Expenses and allowances: Motoring expenses (including mileage allowances) paid on or after 6.4.02: Introduction and legislation
From HM Revenue & Customs · National Insurance Manual
Background to the NICs motoring expenses scheme operative from 6 April 2002 - Social Security (Contributions) (Amendments) Regulations 2002, SI 2002 No 307
Introduction
The Inland Revenue introduced a statutory scheme for dealing with NICs liability on motoring expenses paid to employees using their own vehicles for business travel in the above regulations laid on 13 February 2002.
Effective date
The scheme is effective from 6 April 2002 and replaced the previous administrative arrangements used before 6 April 2002.
See NIM05708 for further guidance on the rules to use for periods before 6 April 2002.
The equivalent scheme for income tax
There is an equivalent scheme for tax but, while the tax and NICs schemes were aligned as much as possible, they differ in various ways. You should not assume that something that is true for one scheme is also true for the other.
Guidance on the income tax scheme begins at EIM31205.
Effects of the NICs motoring expenses scheme
The rules deal with how HMRC treat motoring expense payments relating to privately owned vehicles from 6 April 2002. For more information see NIM05802 onwards.
The scheme also deals with the provision of mileage allowance payments paid to employees who use their own cycles for business travel. For more information about how the NICs motoring expenses scheme applies to cycles see NIM05865.
Exclusions from the NICs motoring expenses scheme
The new rules do not change how HMRC will treat motoring expense payments: