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Business use of employees cars. Many employers pay their employees a monthly car allowance to compensate them for the business use of their private vehicles. In most cases this car allowance is treated as remuneration and is subject to PAYE and National Insurance deductions. Additionally, employers may also pay a nominal amount per mile as a contribution to fuel costs. 45p per mile for the first 10,000 miles in any tax year, and. 25p per mile for any additional use.