Though the tax-free mileage rates for company car drivers who claim back the cost of their fuel has increased by 50% since 2002, the authorised rates for employees who use their own vehicles has not increased over the past five years.

Fuel rates for company cars with two-litre or larger engines have risen from 14p per mile to 21p per mile as of June 1, 2008. This is the maximum amount a company car driver can claim back tax-free.

If you drive your own car for work, you can claim back a maximum 40p a mile for the first 10,000 business miles and 25p a mile over that.

This is higher than the company car allowance because it is meant to cover the total cost of the vehicle, including fuel, insurance and depreciation. However, the rate has stayed the same despite the increasing cost of motoring. Accountants Wilkins Kennedy said it should have increased to 47p a mile if people using their own vehicles were to benefit in the same way as company car drivers.

Assuming a car travelled 10,000 miles in a year, the additional mileage allowance would be worth £700 per employee.

Peter Goodman, senior tax partner at Wilkins Kennedy, said: “The burden of increasing fuel costs falls equally on employees who use company cars and those who use their own cars for business journeys. HMRC should recognise this by increasing tax-free mileage rates for all business use rather than just company cars.

“The tax on company cars has risen significantly in recent years, so there has been an increase in the number of employees who now use their own cars. In these circumstances, HMRC approved mileage rates should reflect the increased costs of motoring so that companies can reimburse such costs in a simple tax-free manner.”

The tax on a company car is determined using the list price of the car multiplied by a percentage based on how polluting it is.

The current range is between 15% for cars emitting 140g or less CO2 per kilometre and 35% for cars with a rating above 240g/km.

A company car driver with a Citroen C3 Pluriel Open costing £14,000 and producing 135g/km of CO2 will have a taxable benefit of £2,100. For a higher-rate taxpayer, this would mean a tax bill of £840.

From 2010, the 15% rate will apply to cars with 130g/km of CO2, down from 140g. Cars producing more than this will pay 1% more for each 5g/km up to 230g/km. For the Citroen driver above, this will mean an annual tax increase of £56.