Managing private mileage can be a tricky balancing act, especially when you’re using a company vehicle. On one hand, you want to enjoy the benefits, but on the other, there are strict rules in place to ensure it’s done properly.
Understanding how to track your mileage and use the right tools can help you stay on the right side of the law while maximising your financial gains. Here are some tips to help you navigate this terrain and get the most out of your company vehicle without crossing any lines.
Know The Rules Around Private Mileage
It’s essential to understand the rules around private mileage. HMRC defines private mileage as any journey that isn’t for work purposes, such as commuting or running personal errands.
If you use a company vehicle for private mileage, you could be liable for a benefit-in-kind tax, depending on how much private use there is. The key is to keep accurate records and avoid any unnecessary journeys that might increase your tax liability.
Use Technology to Track Your Mileage Accurately
The best way to stay compliant with the rules is by using technology to track your mileage. Keeping a manual log might seem like a good idea, but it’s easy to forget or miscalculate your trips. This is where gps for commercial vans comes into play.
By using a reliable GPS system, you can automatically record all your journeys, separating your business and private mileage with ease.
Not only does this help you stay compliant with HMRC regulations, but it also makes it simpler to see where you might be able to cut back on unnecessary private use.
Plan Your Private Mileage Wisely
Another effective hack to maximise your benefits while staying within the rules is to plan your private mileage strategically. Combine personal trips with work-related journeys to reduce the total amount of private mileage.
For instance, if you need to run an errand on the way home from a business meeting, that’s one less separate journey to count as private mileage. As long as you’re within the legal boundaries, combining trips can help you keep your personal mileage low while still getting things done.
Take Advantage of Fuel Reimbursement Options
If your company offers fuel reimbursement for business travel, make sure you’re claiming it correctly. Many businesses will reimburse you for fuel used on work-related trips, but you need to be clear about which journeys qualify.
Keeping an accurate log of your fuel usage, with the help of GPS tracking, ensures that you claim only for business mileage and not private use. This can also help reduce your tax liability, as you won’t be over-reporting private mileage.
In Summary
Staying within the rules for private mileage doesn’t have to be a headache. By understanding the regulations, using GPS tracking, and planning your journeys wisely, you can maximise your benefits without falling foul of the law.
Whether it’s reducing your private mileage or taking advantage of fuel reimbursement, small changes can have a big impact on your tax bill and the overall management of your company vehicle.