Entry of Mileage for Motorbikes and Cycles

Background

Although the recording and entry of mileage data for company cars is very common, some customers may have employees that use a motorbike or cycle for company business. Just like private mileage for cars, there are HMRC Approved Mileages Allowance Rates for these modes of transport:

• Motorbikes = 24p per mile
• Cycles = 20p per mile

P11D Organiser is primarily designed around car mileage and therefore only has calculation of car mileage for Section E of a P11D, which means that any mileage for motorbikes or cycles needs to be calculated outside the system, and then entered into Section M, ensuring the benefit is marked as ‘non-Class 1A’.

Calculation

You only need to enter data onto a P11D if you are paying employees above the AMAP rates detailed above, if you pay those rates (or less) there is nothing to report on an employee's P11D (see later note).

If you do pay a higher rate, you will need to calculate the taxable benefit by taking the number of miles the employee has undertaken, the amount above the AMAP rate you pay, and multiply accordingly. For example, an employee has completed 1,350 miles on their motorbike and you have paid them 30p a mile. You would take the amount above 24p that you paid (6p) and multiply that by 1,350 to calculate the taxable benefit - £81.00.

Data Entry

You would then add a Section M benefit into P11D Organiser, ensuring it is marked as non-Class 1A, as mileage does not attract employer’s national insurance.

1. Find the employee in question > add a benefit > choose Section M.
2. If you have already set up Motorbike Mileage as a description, select that, if not, click the Add button in the lower left corner, select Other items non Class1a from the drop down, and add a description like 'Motorbike Mileage'.
3. Click OK in the lower right corner.
4. Enter the calculated mileage figure, and click Save to add the benefit to the employee.

You would follow the same process for entering cycle miles.

Note

If you are paying less than the HMRC approved rates, the employee can claim tax relief on the underpayment using HMRC form P87 – this needs to be completed by the employee themself, not the employer.