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HMRC internal manual

Employment Income Manual

Exemption for amounts which would otherwise be deductible: Mileage allowance payments

For periods prior to 6 April 2016 see eim30050 et seq.

There is a statutory exempt amount (see eim31240) that employers can pay to employees using their own vehicle for business travel - these payments are known as authorised mileage allowance payments (AMAPs). Where the total payments an employer makes do not exceed the amount of the exempt AMAP for a given number of business miles, there is no requirement for the employer to make a return to HMRC. The payments are statutorily exempt from tax, but the employer will still need to keep records of the payments made and business journeys to which they relate.

Where the payments exceed the amount of the AMAP, the excess over the AMAP is automatically chargeable to tax and NICs as earnings from the employment. The employer will only need to report the excess over the AMAP.

payments within the AMAP rates are covered by a separate statutory exemption, they are not impacted by the expenses exemption.