Mileage Allowance Payments

If an employee uses their own car for business purposes, then you can pay them a set amount per mile tax-free without any need to report details to HMRC.

The amount you can pay depends on the type of vehicle, along with the number of miles already paid for in the current year.

We make this easy for you, allowing you to enter the number of miles and type of car. We then take care of the relevant calculations.

Employee Setup

First you need to edit the employee record to set the type of vehicle they’re using.

When viewing the employee record, select the Pay Options tab and then the Other section.

From the dropdown, select the relevant option.

Adding a Payment

Now start your payrun as usual. Select the employee in the list of payments.

Select the link to Add Mileage, enter the number of miles you wish to pay and update.

A new line adds to the payslip showing the number of miles and the amount paid per mile.

If you need to change the number of miles, select this line, enter the new value and Update.

We automatically track how many miles have been paid for in the current tax year and reduce the rate accordingly.

Opening Balances

If you start with us mid-year, you should enter the number of miles the employee has been paid for already to ensure payment of the correct amount.

First, set the Vehicle Type for the employee as detailed above. Then go to the employees Opening Balances page (accessible from the More drop-down menu).

If the Vehicle Type you select has a varying rate, go to the Opening Balances page and set the value for miles paid so far.

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