The Inland Revenue have announced in a recent Press Release that the authorised mileage rates under the Fixed Car Profit Scheme (FCPS) for 1999-2000 (the tax year starting on 6 April 1999) will remain at their 1998-99 level.
It is essential that those advising or designing products for companies and employees remember that any amounts paid to an employee that is chargeable to income tax under Schedule E can be included in the definition of remuneration for occupational pension purposes and relevant earnings for personal pension purposes.
Any amount paid outside of the FCPS (tax free allowance – see below) could clearly be included in the definition. Of course, in the case of occupational schemes, it would be necessary for the scheme rules to permit the inclusion of such amounts in the definition of remuneration.
As stated above an allowance paid within the FPCS can be paid free of tax, however as this is an arrangement for administrative convenience it is still possible (if the scheme rules permit it) for payments within FPCS to be included with the definition of remuneration. Similarly FPCS payments are included within the definition of relevant earnings for PPP purposes.