AIBU to think it's terrible I'm paying tax/NI on this?

[BetterCallMum]

I drive around as part of my job. Sometimes I need to stay overnight.

Each month, I submit my petrol and accommodation expenses. I get these reimbursed along with my wage the following month.

Although this 'extra money' shows up on my pay slip as mileage or other expenses, the money is then combined with my standard monthly wage. I then pay tax and NI on the whole amount instead of just my wages.

So, let me get this right, i pay for the petrol/hotel costs out of last month's wages (which I've already paid tax on), get this reimbursed the next month only to pay tax and NI on it all over again!

Initially, I was under the impression that I could file a self assessment at the end of the year and claim tax relief on this, however, I looked into it last night on HMRC and I can't claim it back because my employer has already reimbursed me for these costs??

I get on average an extra £250 a month (expenses), not enough to move me up a tax band however it does increase my NI each month.

Does this seem right?

If you are employed and under PAYE then its wrong to tax you on it.

Salary is salary and is taxable. Expenses 'wholly, exclusively, and necessarily incurred' in the performance of your duties is not taxable and should not go through PAYE. Someone in payroll is dilatory.

Nope definitely not right. Those are non taxable expenses which, as you've quite rightly pointed out, are from wages already taxed being spent on petrol etc.

The payroll dept needs to reverse all of these entries and recalculate. Do not take no for an answer!!!

They'll have paid additional NIers on that as well so it's costing them too!

You need to speak to whoever does your payroll.

Each individual item on the 'pay' side of the payslip can be sent to be taxable or not.

Re-imbursement of travel expenses, assuming you have filed claims and not getting round sums, are not subject to tax or NI.

Out of interest, where is your 'base'? Ordinary commuting is taxable. You may need to look at your contract.

(I am a finance director, btw)

SET to be taxable, not SENT - duh..

Yes I disagree with that, I have my petrol expenses paid and these don't get taxed!

I used to submit mine, get it paid separately from my wages, then put in my tax claim at the end of the year.

Thank you. Yes I'm employed and under PAYE in the public sector.

Glad to have some reassurance that it's not right.

I've moaned about it to some colleagues who have been here years and they've said they're in the same boat and 'that's just how it is'.

I think i'll be emailing Payroll tomorrow morning for some clarification.

Yup that’s not right. Those expenses are not taxable.

Yes they’ve done it wrong. It’s essentially repaying you money you’ve loaned to them; it isn’t taxable!

(I’m surprised you don’t have a company petrol card OP.)

That’s not right. When I was working and had to claim expenses; they were never taxed. I got back exactly what I had paid out for taxis/coffees/dinners etc

They've done it wrong.

It's not commuting, no. It's visiting clients. I drive to my base/office each day. Pack up my bag. Then I drive around visiting folk and return to the base at the end of the day. So I submit a claim at the end of each month for the mileage between visiting my first to last client, leaving from the office until I return to the office.

This then appears on my next month's wage as 'mileage' under my standard wage. It is combined under 'total pay and allowances' and then my tax and NI for the month is based on this total figure.

Very annoying. My standard wage is the same every month but i never know how much tax or NI i'm going to pay each month because the mileage and expenses mess things up.

Payroll will have a lot of mess to sort out because they've been doing this to my colleagues for years. I don't think any of them have raised it with Payroll though. They've just complained among themselves.

If it affects everyone I'd be letting your union rep know. If it's been going on for years they'll need to be involved.

It does sound wrong. My expenses are paid separately to my wages and I get the full amount.

I work for a company marking exam papers. When I am training, I claim back my travel and accommodation plus meal allowance expenses after sending receipts in. I also get paid for marking. Only the marking element is taxed and paid NI on.

I'm NHS and that's how they do it. I complained after trying to claim back for flights and accommodation that I pre paid for for a compulsory course I had to go on. Fair to say I've never pre paid for anything again

That could add up to a considerable backdated claim, for multiple people.
So I'd be expecting resistance.
You need union support.

Okay, I can't see my wage slips just now as need to be on the intranet for those, but here are some details from the personal tax account on HMRC:

My standard monthly wage alone is £1495. This is the same each month.

April 18 - taxable income = 1619.86, income tax paid = 124.53, NI paid = 110.14

May 18 - taxable income = 1642.21, income tax paid = 129.13, NI paid = 112.82

June 18 = taxable income = 1712.25, income tax paid = 143.13, NI paid = 121.23

So as you can see, my tax and NI fluctuates each month despite my salary being the same each month. My expenses are being combined with my salary and I'm paying tax and NI on them.

I'm dreading being paid next week. I'm due to get back about £400 in expenses due to a few nights away last month and I'm going to get taxed on it, aren't I?

User - NHS here too! Did they kick up a fuss? There is no way they'd pay me petrol in advance so I need to claim it retrospectively.

Not part of a union. Don't think my colleagues are either

There i was hoping a nice email tomorrow would sort it out. I'm just confused why my colleagues have simply accepted this and it's taken me the newbie to realise it sounds fishy.

Who do you work for in the public sector?

Nhs, hellsbells. Feeling quite nervous now about addressing this tomorrow. I was all fired up about it earlier and ready to kick up a fuss. Now I'm worried they'll somehow use tons of jargon and justify why they're doing it this way and I'll feel a right numpty.

If it's not ordinary commuting, and it's reimbursement of actual expenses (not a round sum allowance) then they're really fucking that up.

If it spans multiple tax years they are gonna have to let HMRC know... Or somebody else should. Goodness knows what else they're doing wrong. I don't understand how a payroll bureau can mess up this badly. This is pretty basic.

I can't believe nobody has raised this before with them. But I suppose that's what happens when we don't teach anybody about the tax system at school.

Did your 17/18 P60 show your gross salary as the amount including these expenses? Or have you not been there long enough?

You can't claim it on your tax return, but you can make an overpayment relief claim if this goes back into previous tax years and your employer won't or can't fix it. There is a time limit of 4 years from the end of the affected tax year (probsbly more relevant for your colleagues).

I used to travel a lot when I worked for a university. We had company credit cards for big meals, petrol hotels etc, and could request a “float” for things like coffees, snacks, or in foreign currency. Other expenses were paid out separately to salaries (eg, payday on 30 of the month, expenses day on 15, or whatever) and definitely not taxed.