As an allowed business cost, claiming business mileage allows you to minimise the amount of tax you owe when you’re self-employed, whether as a single proprietor or director of your own limited company.
It might be difficult for new company owners to maintain track of their business travel and keep track of the documents they need to keep, but it doesn’t have to be.
AIT Accountants can help you make claiming business mileage as a limited company simpler than ever before.
Exactly what constitutes “business mileage”?
Traveling to a client’s location for business reasons is counted as business mileage. In order to be reimbursed for business-related travel, you must only claim for travels that are solely for business reasons.
The amount of tax you pay at the end of the year is reduced by the amount of business miles you incur. This means that you and your company will benefit from taking advantage of business mileage claims.
Who is eligible to claim business mileage?
Business miles may be claimed by sole proprietors and limited businesses alike. Employees may make a claim against you if you are their employer. A claim to HMRC at the end of the tax year is possible if you do not reimburse your employees for business mileage or you pay them less than the allowed mileage rates from HMRC.
Is there a limit on the amount of miles that may be claimed as business-related?
Use HMRC-approved mileage allowance payments for recouping travel expenses (AMAP rates on Gov.uk). Your car’s insurance and maintenance are included in the AMAP pricing.
As of today, the following is what you’ll be charged by HMRC for business miles driven in the following types of vehicles:
| Type of Transport | First 10,000 miles | Over 10,000 miles |
| Car/van | £0.45 | £0.25 |
| Motorcycles | £0.24 | £0.24 |
| Bikes* | £0.20 | £0.20 |
*Only certain types of businesses – not sole traders – are eligible to claim business mileage for bicycles.
It’s critical to maintain track of all business trips as documentation to back up any claim you make.
To claim business miles, what proof is required?
Overall, it’s a straightforward procedure. The following documents should be maintained to guarantee that you may claim mileage as a solo trader, director, or for your employees:
- A record of each journey’s date and location.
- The number of miles driven for business.
If you need help with this or would like to know more about expenses that can be claimed, please contact us at enquiries@aitaccountants.co.uk or get in touch with your AIT contact.
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