Car dashboard

What mileage can you claim for your business?

Accountancy, Thomas Julier

By Thomas Julier, Accountant at Hive Business

Part of everyday working life is often spent sitting in a car, whether you are a business owner, self-employed or an employee. This doesn’t just cost you time but also hard earned cash so you may want to claim as much tax relief on this expense as possible. Why wouldn’t you? But what is allowable according to HMRC and what isn’t?

There are two different ways in which you can claim mileage expenses:

  1. You may claim your actual business petrol costs and the proportion of repairs, maintenance, tax, insurance and other costs which relate to your business use of your vehicle – as long as you can adequately prove the business proportion.
  2. Alternatively, a simpler option is to keep a log of the business miles you have accrued and make a standard rate claim at the relevant rate shown in the table below. The only additional expenses that can generally be claimed alongside the flat rate amount would be the business element of any interest charged on a loan used to purchase the vehicle, parking charges, motorway toll fees and congestion charges.
Type of Vehicle First 10,000 Miles Above 10,000 Miles
Cars and vans 45p 25p
Motorcycles 24p 24p
Bikes 20p 20p

You cannot mix and match between the two as once you use the flat rates for a vehicle, you must continue to do so as long as you use that vehicle for your business.

What is classified as business miles?

You can deduct mileage from your taxes if it is  ‘wholly and exclusively’ for business purposes. HMRC considers this to mean one of the following:

  1. You go somewhere other than your usual workplace to do your job. For example, an associate doing temporary work at another practice.
  2. You are travelling between two different places of work.
  3. The main purpose of your journey is business. You can’t turn a private journey into business travel by running a work-related errand on the way.

As with many other expenses, there is some ambiguity about the definitions and any final decision on whether such travel is allowable should be decided based on your particular situation and in a discussion with your accountant.

Engaging with a knowledgeable accountant is by far the best way of ensuring you can claim as many business expenses as possible but also keeping you within the allowable parameters also. If you’re looking for a proactive accountant please get in touch on 01872 300232 or email [email protected].

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