Introduction
Proving mileage to HMRC is crucial for self-employed individuals to accurately claim tax deductions and ensure compliance with tax regulations. Accurate mileage records can significantly impact the amount of tax relief you receive, making it essential to maintain detailed and verifiable documentation. Here are five key methods to help you effectively prove your mileage, ensuring you maximize your tax deductions and avoid potential issues with HMRC.
Maintain a Detailed Mileage Log:
- Keep a comprehensive mileage logbook with dates, mileage readings, destinations, and the purpose of each trip (business-related).
- Utilize digital mileage tracking apps or software like the Pie Tax App for convenient and accurate mileage recording.
Document Business Travel Itinerary:
- Retain travel itineraries, appointment schedules, or client meeting agendas that validate the business purpose of your journeys.
- Use digital calendars, or scheduling apps to document and store business-related travel details.
Keep Receipts for Fuel and Expenses:
- Save receipts for fuel purchases, parking fees, tolls, and other travel-related expenses incurred during business trips.
- Organize and categorize digital copies of receipts using expense management apps or software.
Vehicle Records and Maintenance Logs:
- Maintain records of your vehicle's service history, MOT certificates, insurance documents, and any repairs related to business use.
- Use digital platforms to store and manage vehicle-related documents securely.
Use GPS and Mileage Tracking Technology:
- Consider using GPS devices or mileage tracking apps that automatically record mileage data during business travels.
- Utilise accounting software with integrated mileage tracking technology such as the Pie Tax App for streamlined expense reporting to HMRC.
Conclusion
Proving mileage to HMRC requires meticulous record-keeping, digital tools, and adherence to tax regulations. Leverage resources like the Pie Tax App for mileage tracking assistance and consult expert tax assistants for personalized guidance on optimizing mileage expense claims and ensuring compliance with HMRC requirements. Accurate mileage reporting can help you maximize tax deductions and avoid potential tax issues.
Frequently asked Questions
What constitutes business mileage according to HMRC?
A business mile is one travelled 'in the performance of your duties'. It's when you're driving 'on the job' as opposed to driving 'to the job'. You're not allowed to claim for any private travel or for most commuting journeys.
Can I claim mileage for commuting from home to my regular workplace?
Generally, commuting mileage is not reimbursable or claimable as business mileage..This is true for all but those termed as itinerant traders.
An itinerant trader is one who travels from their home to a number of different locations for the purely temporary purpose at each such place of their completing a job of work, at the conclusion of which they attend at a different location. A typical example would be a builder.
What if I don't have receipts for fuel or other travel expenses?
If you cannot replace your records, you must do your best to provide figures. Tell HMRC when you file your tax return if you’re using:
estimated figures - your best guess when you cannot provide the actual figures
provisional figures - your temporary estimated figures while you wait for actual figures (you’ll also need to submit actual figures when available)
Are there specific mileage rate limits for claiming business mileage expenses?
The HMRC mileage rates are 45p per mile for the first 10,000 miles and 25p per mile after that for business-related driving.
Can I use mobile apps or GPS devices to track my business mileage?
Yes! A good mileage logging app, such as Pie Tax App will make sure that you have all the information you need for your HMRC mileage claim
