If you have to drive for business purposes, you can save some serious money by claiming back business miles and applying for tax relief. Not all drivers are eligible for tax relief, however. The two most common types of drivers who can claim back business miles are those who are self-employed and anyone in a grey fleet scheme.
A self-employed person runs their own business and therefore must use their vehicle for both personal and business travel. Someone who’s part of a grey fleet drives a vehicle that’s neither owned nor leased by their company for business travel. In a grey fleet scheme, businesses utilise personal vehicles for business travel.
FAQ’s About Claiming Back Business Miles
Determining your eligibility to claim back business miles can be confusing. This section will address the most commonly asked questions about tracking business mileage, who qualifies for it and the best business mileage tracker methods.
What Defines “Business Mileage?”
By definition, business travel is any journey that forms part of an employee’s work duties, including travel to a temporary workplace. As such, business mileage is any mileage that’s logged while on the job. Note that business miles cannot be claimed for your regular commute to and from your permanent place of work.
Who Qualifies for Claiming Business Miles?
If you use cars, vans, motorcycles or bicycles for work, you may be able to claim back business miles. If you have bought or leased a vehicle yourself, you’re likely eligible to claim back business miles. This includes anyone who’s part of a company grey fleet as well as self-employed persons.
What Are the Mileage Rates?
According to the UK government the current mileage rates are as follows:
- Cars and vans: 45p per mile for the first 10,000 business miles of the year. 25p per mile for any additional business miles.
- Motorcycles: 24p per mile for the first 10,000 business miles of the year and for any additional business miles thereafter.
- Bicycles: 20p per mile for the first 10,000 business miles of the year and for any additional business miles thereafter.
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What Does the Mileage Allowance Cover?
The mileage allowance you claim back on business miles is meant to cover fuel, insurance, tax, vehicle maintenance and depreciation. The mileage rates listed above may seem generous to some, and stingy to others. Keep in mind that the mileage rates are calculated based on the average cost of running and maintaining a vehicle. As such, it doesn’t matter whether you’re driving a brand new vehicle or a much older model — all business vehicles are treated the same.
How Do I Calculate My Mileage Claims?
To calculate the number of business miles you’re able to claim, you’ll need to keep careful records of the dates and mileage of your work journeys. Then, add up the mileage of each vehicle you’ve used for work and subtract any amount your employer has paid towards your costs throughout the year.
What’s the Easiest Way to Track Business Miles?
The easiest way to track your business miles is to use a mileage claim form template. Vimcar has created a mileage claim form template that you can download for free and begin using immediately.
If you’d rather not rely on paper mileage logs, the Vimcar Dongle has a digital business mileage tracker function. Vimcar’s software is easy to use and it logs the route and mileage of your vehicle automatically. With this data, it’s easy to categorise your miles retrospectively and track which were personal and which were business-related.
Get a Free Mileage Log Template
Ready to Use a Business Mileage Tracker?
Whether you prefer to use a paper mileage claim form template to track your business miles or you’d rather invest in a digital business mileage tracker like the Vimcar Dongle, it’s important that you begin tracking your business miles today. Mileage tracking can save you money, but you need to make sure you’re tracking the right data to get the most money back as possible.