Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what recent assessment has she made of the potential impact of uprating mileage allowance scheme rates on the travel costs of people working in the voluntary sector.

Approved Mileage Allowance Payments (AMAPs) are used by employers to reimburse an employee's expenses for business mileage in their private vehicle.  These rates are also used by self-employed drivers to claim tax relief on business mileage (simplified motoring expenses) and can be used by organisations to reimburse volunteers who use their own vehicle for voluntary purposes.

Voluntary organisations reimbursing volunteers can either use the AMAP rates or can reimburse the actual cost incurred where the volunteer drivers can evidence such costs without a tax liability arising. Any reimbursement above the AMAP rates would be subject to Income Tax unless the driver can show evidence of the expenditure. It is ultimately up to the voluntary organisation to determine the amount they reimburse to volunteers.

In estimating typical motoring costs per business mile HMRC use a variety of information. This includes information from the AA, the National Travel Survey, the Association of British Insurers and the Department for Energy Security and Net Zero (fuel prices). The AMAP rate is intended to reflect both running costs (such as fuel) and a proportion of standing costs (such as insurance, MOT and depreciation).

As with all taxes and allowances, the Government keeps the AMAP rate under review. Any changes to are announced by the Chancellor at fiscal events, taking into account the wider economic and fiscal context.