Accurately monitoring business mileage is essential when running a successful fleet
Not only does it help you see how and where you can save fuel and cut costs, it can also help to cut your carbon footprint, which is essential for any forward-thinking business.
Accurate business mileage tracking was once a time-consuming process that involved separating personal miles from business miles, armed with nothing more than a calculator and a pile of receipts. But now, technology offers a simple way to track mileage, report expenses and manage the fuel and cost efficiency of your fleet.
To streamline the process more effectively, you should use Allstar Business Mileage Monitor.
But before we explain how our automated online process can help you to manage your fuel expenses more effectively, let’s take a closer look at exactly what your employees can claim, and how you can accurately calculate business mileage.
Business mileage – what can employees claim?
Any employee or company director who uses their own car for business-related travel, or who uses a company car or fleet vehicle for personal use, can claim business mileage. That’s why it’s vital you have a system in place to differentiate between those miles that are recorded for business purposes and those that have been clocked up on personal trips.
If you provide employees with a vehicle, but they pay for the fuel, then HMRC set advisory fuel rates (AFR) that should be used when reclaiming business mileage. These rates vary depending upon vehicle type, engine size and fuel type, and are updated every four months, so both you and your employees will have to keep on top of them to make sure the correct amount is being paid
Hybrid cars are treated as either petrol or diesel for AFR purposes, while the rate for electric vehicles is 4p per mile.
It’s worth noting that these rates are only guidelines, but while you can set your fleet rates differently, you should still keep them close to the advised rates.
If you pay for your employees’ fuel, for both business and private journeys, then employees will then have to pay fuel benefit tax.
How can you calculate business mileage?
To calculate business mileage rates, you simply need to multiply each employee’s business mileage by the relevant mileage rate, which should be based upon HMRC’s advisory fuel rates.
Explore our new tool, our fuel card calculator, to explore the further benefits and cost-savings to be had with Allstar's range of services.
It’s worth noting that AFRs apply to standard rate VAT registered companies, and are used to calculate the following:
The amount of VAT that can be reclaimed on business mileage in a personal vehicle
The amount employees can be reimbursed for business travel in company cars
The amount employers can be reimbursed for private travel in company cars.
Tax relief on business mileage
Employees looking to claim tax relief on business mileage need to be made aware that this doesn’t include commuting, unless it’s to a temporary place of work. The amount that can be claimed can vary depending upon whether they’re using a vehicle they’ve bought or leased with their own money, or a vehicle that is owned or has been leased by the business.
How Allstar’s Business Mileage Monitor can help
The good news is that Allstar’s Business Mileage Monitor can help streamline the entire process.
Allstar’s Business Mileage Monitor is designed to take the hassle, as well as the potential for human error, out of tracking fuel usage and claiming business mileage. Our HMRC-compliant system offers a fully automated fuel management tool that works seamlessly with any of our fuel cards.
Simply sign up for our Allstar One fuel card or Supermarket fuel card and you’ll get access to our Business Mileage Monitor, which offers the following benefits:
Accurate calculation of your driver’s mileage, both private and business
Full details of ever driver’s journey
Actual pence per mile calculations
Breakdown of all drivers’ fuel card transactions, including an itemised VAT invoice
The accurate and automated separation of private and business mileage comes with a huge number of benefits both to the employee and employer.
Where employees would otherwise have had to keep extensive records of dates and miles driven on business journeys to calculate any tax relief they could claim, our Business Mileage Monitor provides all this data in an accessible spreadsheet at the click of a finger. These records will be more accurate and reliable, and you’ll have them to hand when you need them, so you won’t need to chase your staff to submit records when a tax deadline approaches. You can rest safe in the knowledge that all your reporting is HMRC-compliant, so there’s no need to worry about fines or demands for unpaid taxes once you start using the Business Mileage Monitor.
Employees that use their own car for business travel find themselves collecting stacks of receipts to reclaim their business miles. But when you equip them with our Business Mileage Monitor, in conjunction with their Allstar card, they can provide you with their business mileage records – while keeping their personal mileage private – to allow you to (in conjunction with HMRC’s approved mileage allowance payments, or AMAPs) work out exactly what’s owed. As an employer, you can be confident these calculations are fair, and any employee will find the hassle-free process a relief.
Where an employee uses a company or fleet car for both business and private travel, exaggerated and excessive claims are the natural concern of any employer. With the Business Mileage Monitor and Allstar One card, the accurate and separate calculation of private and business mileage will put minds at ease. Complete with accurate pence per mile calculations, any employer can total their fleet’s allowances as and when required. Where the company covers both business and private mileage, the Business Mileage Monitor collates the data needed to work out the employee’s fuel benefit tax requirements.
Ready to go?
Now you know exactly how Business Mileage Monitor can help your fleet, it’s time to join the 38,000 businesses and 1.1 million drivers who save time, money and hassle by becoming a part of the Allstar fuel card family.
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