The MPs won their tax battle with the Inland Revenue after appealing against their tax bills to the independent tax appeal commission which decided the allowances should be given.
The MPs are said to have claimed car mileage and depreciation allowances for parliamentary business while using company cars. One unnamed MP, who claimed for three company cars at different addresses, is said to have saved £40,000 in tax, interest and penalties.
The issue revolves around the mileage rates of up to 74p a mile granted to MPs. The rates are high because they are designed to allow MPs to buy a new car every three years and cover maintenance and insurance as well as petrol. However, MPs who have company cars as part of a director's remuneration package or charge their car to their businesses have none of the additional costs.