How has the proposed rate of 40p per mile been arrived at?

A. The 40p per mile rate is that recommended by Her Majesty’s Revenue and Customs (HMRC), and is in line with the AA’s current cost breakdowns. HMRC recognises that 40p per mile covers business insurance, fuel, servicing, tyres, tax, insurance and depreciation.

Any rate in excess of 40p is taxed by HMRC. The 40p rate will be kept under review in joint discussions with the trade unions. In addition a new passenger rate of 5p per mile has recently been agreed where an employee carries fellow NCC employees or employees of a partner organisation as passengers.

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