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Employees unpaid for work mileage

A car's fuel gauge11/01/13

By Michael Allen

Although more and more employees are providing their own vehicles for work few are getting the full Government-approved mileage rate, research by the AA shows.

Over six million people now claim mileage expenses for using their car at work - around double the number in 2001 - but only a third of them get the Government-approved 45p-a-mile allowance for the first 10,000 miles, according to the organisation.

The AA/Populus survey of AA members who use their car for business found that only 30.3 per cent were paid the 45p-a-mile untaxed maximum.

In March 2011 the Chancellor announced a 5p increase in the untaxed allowance, but only 35 per cent of the 5,094 drivers polled were benefiting from this by claiming between 41p and 45p per mile.

The AA also highlighted the fact that while the USA tax threshold on private car mileage allowances has increased by 52 per cent over the last decade the UK's has risen by just 12.5 per cent.

AA president Edmund King said: "Twice the number of drivers claiming for work-related mileage compared to 10 years ago shows the extent to which firms have increasingly relied on their employees to provide transport for work.

"Between 2008, when petrol prices first approached 120p a litre, and March 2011, when petrol cost 133p before reaching 137.5p that summer, workers using their own cars were getting angry. Not only were they insulating firms from the impact of soaring pump prices but effectively taking a wage cut.

"The Chancellor's 5p boost in 2011 went largely unnoticed, which the AA now reveals potentially affects six million working drivers. However, the unrestrained pump price surges over the past two years augur more pressure to raise the threshold in the not-so-distant future."

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