Despite the Government’s Authorised Mileage Allowance Payment (AMAP) rates being only advisory, over 72% of fleets surveyed in a Fleet News poll still use them to reimburse their grey fleet drivers for business trips.

However, while the majority continue to pay their grey fleet drivers at AMAP rates, 21% of respondents said they now pay lower than AMAP.

The rates they pay vary between just 11p per mile and 37.5ppm.
Respondents said they use lower rates to deter drivers from using their own cars for business travel and encourage them to use other means of transport.

One fleet manager said the company’s drivers are offered a fully funded and fuelled company vehicle as an alternative to using their own car.

That company pays just 11ppm to those employees who continue to use their own cars. AMAP rates, which are currently set at 40p per mile for the first 10,000 miles, are seen by some to be set so high that they encourage employees to drive their own vehicles on business trips.

The Office of Government Commerce (OGC) said that AMAP rates could be seen as incentivising grey fleet use. It is running a campaign to get public sector fleets to reduce their grey fleet use.

The BVRLA has also called on the Government to lower AMAP rates, which it said are “over-generous” and “encourage staff to use their own cars instead of potentially much greener and safer forms of transport”.

Research by Fleet News’ sister company Sewells and the Energy Saving Trust found that nearly one-third (31%) of grey fleet vehicles cover more than 7,000 miles a year on business (see Fleet News April 29).

The research also revealed that 24% of grey fleet vehicles cover more than 10,000 miles a year on business-related travel.

Those grey fleet drivers that are currently reimbursed below the AMAP can still seek tax relief (up to the level of the approved mileage rates) provided they have kept proper records of business journeys.

On the flip side, drivers who are paid more than the AMAP rates will be liable to pay tax on the excess.

Go to www.fleetnews.co.uk/fleet-operations/grey-fleet/ for advice and case studies on how best to manage your grey fleet use.