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HMRC internal manual

Employment Income Manual

Employees using own vehicles for work: employers’ record- keeping requirements: reasonable evidence

Sections 229 and 230 ITEPA 2003

The key features of the approved mileage allowance payments (AMAPs) system with regardto employers’ reporting requirements are as follows:

  • where the mileage allowance payments (MAPs) do not exceed the approved amount and therefore all qualify in full for exemption from tax as AMAPs, the employer makes no report to HMRC of the amounts paid. As there is a statutory exemption from tax (as opposed to a taxable amount that is balanced by an underlying deduction), a dispensation is not appropriate but the employer will still need to keep records of the payments made and the business journeys to which they relate.
  • where the MAPs exceed the approved amount, payments are split into two categories - the approved amount (see EIM31215), and the excess over the approved amount that is chargeable to tax under the normal rules. The excess over the approved amount should be reported on form P11D.
  • items related to the employee’s vehicle but that are not mileage allowance payments are reported as in EIM31215.


A dispensation cannot cover items within the AMAPs scheme (see EIM31210),only those outside it. This is because employees cannot get a deduction for actualexpenses of business travel (see EIM31335). Instead, adeduction is available for mileage allowance relief (MAR, see EIM31330onwards) which is independent of the level of actual expenditure incurred.

For dispensations in force at 6 April 2002:

  • any part relating to expenses now within the AMAPs scheme ceased to be effective from that date
  • all other parts remain in force until the dispensation itself is superseded.

Where an employer provides something in connection with the employee’s own vehiclewhich is not a mileage allowance payment and this is not covered by a dispensation:

  • the employer will report the item in full on form P11D or P35 as appropriate, and
  • as the item is not a MAP, it will not be used to restrict the amount of MAR to which the employee is entitled.

See example at EIM31365.

Mileage allowance relief optional reporting system (MARORS)

Employers can agree with their HMRC office to make separate optional reports ofnegative amounts, that is where the allowance paid is less than the approved amount. Ineffect the amounts reported are the same as the MAR that each employee can get. Onlynegative amounts can be reported under MARORS.

More than one kind of vehicle in use

If more than one kind of vehicle (EIM31240) is in use andthere is a taxable excess on one kind and MAR available on the other, these should bereported separately on forms P11D, not amalgamated.