On the first day of TAXmas, we advise to thee on an NIC reclaim on mileage...
Employers – What can you give back to your employees this Christmas without it costing you anything extra?
How about a cash NIC refund for the last 6 years from our friends at HM Revenue and Taxes?
You could make a claim where your employees have received a cash allowance instead of a company car and have been reimbursed for driving their own cars on employer business at less than 45p per mile.
A typical refund for one employee who has average business miles of 10,000 per year, received a cash allowance of £3,000 and been paid a mileage rate of 15p per mile would be in the region of £12,000 over the 6-year refund period.
At the same time, the employer can also claim a NIC refund of up to £20,000 based on the same pattern as set out above.
This is the truly the gift that keeps on giving because the savings don’t end there, as the NIC savings can continue after Christmas into 2024 and beyond.
Apply to Santa
Unfortunately, this Christmas gift is not one that Santa Claus will leave in your stocking to unwrap; employers need to formally claim the refunds directly from HMRC after carrying out the relevant due diligence into their own arrangements.
If you need any help with employment tax matters, either for the Christmas past, present or the future, please get in touch with us at firstname.lastname@example.org.