What happens if I can't afford petrol to get to work each day?

June 27, 2022

Petrol and diesel prices have soared to unprecedented levels over recent months, breaking new records almost every day.

The war in Ukraine has driven a further escalation in an increase that was already under way.

And while all motorists have been feeling the effects, the impact has been worst among those for whom the use of a car is essential.

With this in mind, we put a question to personal finance expert Gemma Godfrey that will be of interest to a large number of people given the intensifying cost of living crisis: How do you stand with your employer if you can't afford to put petrol or diesel in your car to get to work everyday?

Here's her answer in full:

This is a really hard question because the rising cost of fuel is hard to avoid. If driving to work is the only way to get there, then it can be a catch-22, as you need to drive to earn and earn to drive. Unfortunately, there's little in the way of statutory support from employers for driving to/from work.

It could still be worth discussing travel concerns with an employer, as they may have chosen to provide their own company-specific support schemes.

Also, while your question implies that public transport might not be an option here, it might be worth knowing that many companies offer a travel season ticket loan. This enables employees to save money on travel (by public rail, tube, bus, tram and boat) by paying upfront for a whole season of travel with an interest free loan from an employer.

As this is a loan, though, this will need to be repaid. Therefore, it may still be worth having a discussion with an employer, to check how affordable any schemes are over the longer term.

The other area an employer may be able to help is with essential business-related driving.

In that case it might be worth discussing Mileage Allowance Payments. It's a payment employers can make to employees for using their own vehicles for business journeys. Employers can pay 45p per mile up to the first 10,000 miles and then 25p per mile thereafter.

Companies aren't obliged to make these payments but they can get some tax relief, which might be encouraging. The good news is that if you are paid less than the approved 45p per mile rate, then you can claim tax relief on the difference. Although of course this doesn't help with upfront fuel funding needs, and if too much mileage is reimbursed, then the excess will need to be taxed.

Nevertheless, there also could be further financial support available by helping to take a colleague on work-related travel. This reimbursement is up to 5p per mile per passenger and is also tax-free. So that could help colleagues, the environment and your wallet.

Gemma is a business advisor, finance expert and TV host, an ambassador for the charity Surviving Economic Abuse, and a former boardroom adviser to Arnold Schwarzenegger on The Apprentice.

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