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Do You Make These Common Mistakes When Recoding Your Mileage?


mileage gauge

When it comes to expenses, travel can be a somewhat tricky area, but it’s also one that affects a lot of employees and the self-employed. Mileage claims for driving are a very useful way of gaining back some of the money you pay in tax and travel expenses.

However, are you keeping track of your mileage correctly?

The lines between whether a journey is classed as “business”, or a “private” one can get increasingly blurred. You also need to account for instances where your employer pays for any of your private travel, which there will almost certainly be additional tax to pay. Like we said, it can be tricky!

Never fear though. We’ve noted some of the most common mistakes people make right here, so you can avoid losing out on money you’re potentially owed on your mileage.

Mistake #No1 – Not keeping track of your mileage

“I’m busy at the moment.”

“I really can’t be bothered.”

“I’ll do it later!”

“I won’t get much back for it anyway”

Sound familiar? All too often, when people know they’re able to save money, but have to do something to get it, it all seems like too much effort. We’ve heard these types of phrases so many times.

What if you could receive £1,000 or more back in tax from HMRC? Sounds more appealing already doesn’t it! You could even earn up to £4,000 in extreme cases. If you’re not keeping a record of the miles you’ve travelled though, you won’t get anything back. You can’t just guess.

When you want to make a claim for any distance you have travelled, you need to make a note of the dates, where you visited and the miles covered every time you go somewhere. If you visit somewhere on a regular basis, it makes it even easier, as you can just replicate it.

Pro Tip: Keep a diary in your car, it’s the best way to remind yourself to record the journey you’ve completed. Take note of your starting mileage on the gauge and then just log it when you’ve finished to see how far you’ve travelled.

That’s it. As simple as that. Now, isn’t this little bit of work worth doing for such a good reward!

Mistake #No2 – Retrospect

If you submit a claim, HMRC could decide to open an enquiry to further look into your claim if they want to. It’s rare, but it can happen. If you’ve recreated your mileage retrospectively, they’re likely to disallow your claim.

On the other hand, if you’ve been contracted to work at a site for a long time (no more that 24 months) your invoices could be reviewed, or your contractor can give you a statement to plan your mileage more easily. Feel free to give the team at Claim Back Tax a call if this is the case, we’ll be happy to help.

Mistake #No3 – Make sure you don’t claim the wrong expenses

Going back right to the start of this post, we mentioned you can make a claim whether you’re employed or self-employed. Be careful though as the rules are a bit complex and can differ depending on which one you are.

When it comes to PAYE, you can’t be based at the same place for more than 24 months and you have to have completed several journeys to different sites during that year of employment. If you don’t, HMRC will dispute whether you’ve just travelled to a permanent place of employment. To be eligible, it should be a temporary place of employment or visiting clients.

For individuals that are self-employed it’s a little different, due to your registered address and what your position is. If you haven’t changed your work site during the year, HMRC will consider travelling to one site a permanent place of employment, so you won’t be able to make a claim for business mileage or motor expenses.

Working from a home address means you’ll need to demonstrate your business runs from there.

Now, if you’re a company director driving your own car, putting mileage expenses through the company will be the only way you can claim business mileage tax as you can’t make a personal tax claim for things like fuel or car repairs.

In the end…

It’s down to you really. Sure, making a claim can be difficult to do if you don’t know all the rules, but if all you have to do is jot down where you have travelled to, from and how far it was, it’s got to be worth the money you could potentially claim back. If you’ve never claimed before, you can even claim up to 4 years!

Our advice is simple. Don’t miss out. If there’s an opportunity to keep more of the money you ear and work hard for, why wouldn’t you want to take it? Keep yourself organised and make it easy for yourself and if you need some help, just get in touch with our mileage tax specialists who can assist you further.