Question to the HM Treasury:

To ask Her Majesty's Government what assessment they have made of whether the 45p per mile fuel allowance for cars and vans should be increased due to (1) the length of time it has remained unchanged, and (2) the increased cost of fuel.

The Government sets the Approved Mileage Allowance Payments (AMAPs) rates to minimise administrative burdens.

Employers are not required to use the AMAPs rates. Instead, they can agree to reimburse the actual cost incurred, where individuals can provide evidence of the expenditure, without an Income Tax or National Insurance charge arising.

Alternatively, they can choose to pay a different mileage rate that better reflects their employees’ circumstances. However, if the payment exceeds the amount due under AMAPs, and this results in a profit for the individual, they will be liable to pay Income Tax and National Insurance contributions on the difference.

The Government keeps this policy under review.