If you use your own vehicle for business journeys, then you may be able to claim a tax-free allowance from your employer known as a Mileage Allowance Payment or MAP. The allowance is paid when employees use their own car, van, motorcycle or bike for work purposes. It is important to note that this tax-free allowance is not available for journeys to and from work but is available where employees use their own vehicles to do other business-related mileage. 

Employers usually make payments based on a set rate per mile depending on the mode of transport. There are approved mileage rates published by HMRC. For cars, the approved mileage allowance payment for the first 10,000 business miles is 45p per mile and 25p per mile for every additional business mile. An equivalent payment of 20p per mile is available for bicycle travel and 24p per mile for motorcycle travel. These rates have been fixed for many years and HMRC has confirmed that they will continue to apply for the current 2022-23 tax year.

If an employee travels with business colleagues, they can claim an additional 5p per passenger per business mile for each qualifying passenger. Where an employer pays less than the published rates, the employee can make a tax relief claim for the shortfall using Mileage Allowance Relief (MAR). There is no equivalent to MAR for passenger payments, which means that if the employer pays less than 5p per mile to carry a passenger, the driver cannot claim any tax relief on the difference.

Please note that if employees are paid more than the approved mileage rates then the excess is treated as a Benefit in Kind. Conversely, if employees are paid less than the published rates, they can make a tax claim for the shortfall using Mileage Allowance Relief (MAR). There is no equivalent to MAR for passenger payments.

As a general rule, there is no tax relief for ordinary commuting. The term 'ordinary commuting' is defined to mean travel between a permanent workplace and home, or any other place that is not a workplace. Case law has also confirmed that travel between home and a permanent workplace is ordinary commuting even where home is also a workplace.

In practical terms this means that there is no deduction for the cost of travel between an employee's permanent workplace and:

• an employee's home (with limited exceptions), or
• any other place the employee visits for reasons that are not related to the employment, or
• any place at which the employee performs the duties of another employment.

Any journey between an employee's permanent workplace and home or any other place at which the employee's attendance is not necessary for the duties of that employment, is ordinary commuting for which no deduction is due.

The rules are different for temporary workplaces where the expense is allowable. A workplace is defined as a temporary workplace if an employee goes there to perform a task of limited duration or for a temporary purpose.

There are specific exemptions from tax for works bus services and subsidies paid to public bus services as well as for the provision by an employer of bicycles and cycling equipment in order to encourage environmentally friendly transport between home and work.

The Coronavirus Statutory Sick Pay Rebate Scheme has allowed small and medium-sized businesses and employers reclaim Statutory Sick Pay (SSP) paid for sickness absence due to COVID-19. The online service initially closed for new claims after 30 September 2021.

However, following the Omicron wave, the online claims service was brought back in mid-January with firms becoming eligible to make backdated claims under the scheme from 21 December 2021.

The scheme covers up to 2 weeks’ SSP per eligible employee who has been off work because of COVID-19. Employers are eligible for the scheme if their business is UK based, small or medium-sized and employs fewer than 250 employees. Under the scheme, the Government will cover the cost of SSP for Covid-related absences.

In line with the government’s measures to move to a new phase of 'living with COVID', the scheme will close for coronavirus related absences after 17 March 2022. Employers will have up to and including 24 March 2022 to submit any final claims and / or amend claims they’ve already submitted.

Employers should maintain records of staff absences and payments of SSP for 3 years after the date they receive the payment for a claim. Note, employees do not need to provide a GP fit note in order for an employer to make a claim.

If you are an employee working from home, you may be able to claim tax relief for some of the bills you pay that are related to your work. 

Employers can reimburse employees for the additional household expenses incurred by working at home. The relief covers expenses such as business telephone calls or heating and lighting costs for the room you are working in. Expenses that are for both for private and business use (such as broadband) cannot be claimed. Employees may also be able to claim tax relief on equipment they have bought, such as a laptop, chair or mobile phone.

Employers can pay up to £6 per week (or £26 a month for employees paid monthly) to cover an employee’s additional costs if they have to work from home. Employees do not need to keep any specific records if they receive this fixed amount. 

If the expenses or allowances are not paid by the employer, then you can claim tax relief directly from HMRC. You will get tax relief based on your highest tax rate. For example, if you pay the basic (20%) rate of tax and claim tax relief on £6 a week, then you would get £1.20 per week in tax relief (20% of £6). You can claim more than the quoted amount but will need to provide evidence to HMRC. HMRC will accept backdated claims for up to 4 years. 

These tax reliefs are available to anyone who has been asked to work from home on a regular basis, either for all or part of the week including working from home because of coronavirus.

If you receive no compensation from your employer for work related expenses you have paid, you can still claim tax relief for some expenses that relate to working from home. HMRC will usually allow you to claim tax relief if you use your own money for things that you must buy for your job, and you only use these items for work. You must make a claim within 4 years of the end of the tax year that you spent the money.

For example, if you use your own uniforms, work clothing and tools for work it is possible to claim for the cost of repairing or replacing small tools you need to do your job as an employee (for example, scissors or an electric drill), or cleaning, repairing or replacing specialist clothing (for example, a uniform or safety boots). A claim for valid purchases can be made against receipts or as a 'flat rate deduction'. However, you cannot make a claim for relief on the initial cost of buying small tools or clothing for work.

Note, you cannot claim tax relief for Personal Protective Equipment (PPE). If your job requires you to use PPE, your employer should either:

• give you PPE free of charge
• ask you to buy it and reimburse you the costs

You may also be able to claim tax relief for using your own vehicle, be it a car, van, motorcycle or bike. As a general rule, there is no tax relief for ordinary commuting to and from your place of work. The rules are different for temporary workplaces where the expense is allowable and if you use your own vehicle to undertake other business-related mileage.