Why are out of pocket expenses taxed?

[MrEarl]

Hello,

I'm a full time employee, who incurs out of pocket expenses, as a consequence of my work (in simple terms, I often have to use my own car and fuel, to travel to and from business meetings, at various locations).

My employer reimburses my costs, by way of mileage payments, subject to me submitting individual claims, based on the related distance to and from each location etc.

However, the travel expenses are being reimbursed, subject to deduction of tax.

The effective tax rate makes no sense to me, ranging between 5% - 15% of the claim, submitted.

Can anyone explain why these mileage expenses are being taxed ?

Thanks.

 

[T McGibney]

However, the travel expenses are...subject to deduction of tax.

The effective tax rate makes no sense to me, ranging between 5% - 15% of the claim, submitted

This couldn't be correct.

Raise it with your employer.

 

[mathepac]

The simplest thing to do is have your employer pay the pre-approved Public Service rates of fuel and subsistence allowances which are payable tax-free

Current rates

Or from Revenue site, in case of differences

 

[T McGibney]

The simplest thing to do is have your employer pay the pre-approved Public Service rates of fuel and subsistence allowances which are payable tax-free

On second thoughts, it's possible here that the OPs mileage claims are in excess of the applicable tax-free rates and the taxable excess is being taxed on their payroll.