NSP Registered Posts: 4 New contributor 🐸
I need help to as regards to what is considered business miles and what is considered as private miles if the company provides a vehicle.If I am based away from my office and if I come in occasionallyis this considered as business miles or Private miles.


  • peugeot
    peugeot Registered Posts: 624 Epic contributor 🐘
    Now this is a very grey area and one which I have had to deal with very recently for a large client of mine.

    It would all depend on the nature of your job and whether 'frequent' visits to the office are necessary and how frequent these visits are i.e. would they be classed as 'routine' in which case a benefit may well be triggered. As well as this would also depend on the number of 'pool' cars, where these are kept, whether you have a choice as to which car to drive and also how you record your day to day mileage.

    As you can see, it isn't a 'yes or no' question and your employer would be best speaking to a compliance officer at HMRC (not an agent at the call centre) to clarify the situation further.

    Kind regards
  • NSP
    NSP Registered Posts: 4 New contributor 🐸
    peugeot thanks for that.I work in the account dept and I constantlay have an argument with our managers. Seeif this makes any sense
    The tax rules for establishing business travel can be complex but I have summarised the position in broad terms below:

    Each of you falls into one of three categories:

    1. Live local to the office – ie. near enough to pop in every day
    2. Live too far away to call into the office every day and call in occasionally when necessary
    3. Live too far away to call into the office every day but come into the office on a regular basis.

    Trips to the offices for each of these categories is treated differently, details as follows:

    1. Live local to the office – if you come into the office from home, this MUST be treated as private mileage and shown on your mileage sheet as such.

    2. Live a distance away and call in to the office as and when necessary, this is treated as business mileage.

    3. Live a distance away but call in on a regular basis, ie. every Friday or every Tuesday afternoon – this MUST be classed as private mileage as you are doing the same journey on a regular basis and thus the office has become a permanent place of work on that day of the week, every week as an obvious pattern of work has emerged. It doesn’t matter if you have called into a customer on the way.

    If you fall into category 1, mileage to your first customer from home will be classed as private mileage unless that customer lives outside of the home / office geographical area. (this is measured as a percentage of miles that you would travel normally to get to the office). Likewise, journeys back to home from the home / office geographical area will be classed as private mileage.

    For all of you that fall into categories 2 & 3, mileage to your first customer from home is classed as business mileage and mileage thereafter between customers is also classed as business.

    The other issue that concerns the Company and our accountants is your private mileage declaration.

    If the Company was to have an Inland Revenue inspection they would examine your mileage records and if they didn’t tally from one month to the next, ie in February - journey from home to point A was 78 miles but in April, journey from home to point A was 112 miles and there is no explanation, they may decide that you made a false declaration in February and had some private fuel provided. As a result, you could be liable for tax on the whole years ‘fuel benefit charge’.

    If you did the same journey in February as you had done in April but had to take a detour because of road works or an accident it is important that this is recorded on your mileage sheets.

    The Inland Revenue expect you to demonstrate that your mileage records are accurate and if you are unable to do so, a tax liability is likely to arise and the Company could also face a liability.

    Please don’t think that the Inland Revenue expect you to have a Company car and not do any private mileage at all, as you would be pretty unique.

    Any questions, please ask, otherwise you are all advised to:
    · Be accurate with your forms,
    · Complete them for every journey - at the time of the journey, not at the end of the month when you can’t remember where you went and when
    · Explain any unusual changes to your normal routes.
  • peugeot
    peugeot Registered Posts: 624 Epic contributor 🐘
    Yes that does make sense. However, my advice would be to liaise with your local HMRC office and get them to confirm in writing what their deemed treatment of the above would be. It is normally the case that where concessions are granted by HMRC that no taxable benefit would arise, that they require you to review the situation at least annually to see if the concession is still appropriate.

    It is in the employee's interest to ensure they comply with requests such as mileage logs etc. In my experience, employees often moan about having to complete these but my answer is 'tough - you either complete them or you don't - if you don't you'll get a taxable benefit' it usually works.

    Kind regards
  • Poodle
    Poodle Registered Posts: 711 Epic contributor 🐘
    Hi NSP

    I would 100% back what Steve is saying here, I have found the local compliance office to be really useful in this sort of situation, I had a similar situation and mine also included overseas travel/subsistence payments to employees seconded from the US to work in the UK. I actually got the compliance officer to call out to my work place and speak with the directors for back up to what the managers were always moaning about, that helped as well.

    If you have a staff hand book it is always useful to have details of any arrangements put in there and if you get a letter from the compliance officer I found giving the employee a copy of that with a covering letter from me usually settled any arguments.

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