Grab a to-go cup of coffee and queue up your favourite playlist: it’s time for a business trip. But you’re not setting out in some stuffy company car: you’re hitting the road in your very own, personal vehicle. 

There’s an estimated 4 million ‘grey fleet’ cars in the UK – or employee-owned vehicles used for business purposes. Whether you have a goal of acquiring a company car in the future or you’re content cruising in your own, here’s how you can be financially responsible when using your personal vehicle for a business trip: 

Understand what constitutes as a business trip 

It’s important to note that travelling to your standard place of work doesn’t count as a business trip. That means you can’t claim fuel or mileage on your daily commute to the office. 

A few types of journeys that would count as a business trip in the eyes of HMRC are: 

  • Attending business meetings 
  • Visiting clients 
  • Attending networking events 
  • Delivering goods 

Remember: these trips must be wholly and exclusively for business purposes if they’re to be considered a business expense. If, after you attend a networking event, you decide to visit Aunt Sue in the next town over, you won’t be able to count your mileage or petrol costs for this part of your journey as a business expense. 

Claim mileage instead of petrol costs 

When it comes to expensing use of your personal vehicle for a business trip, there’s two different roads (get it?) you can go down: claiming back petrol costs or claiming approved mileage allowances. 

An Approved Mileage Allowance Payment (AMAP) is the maximum amount that can be paid by an employer per business mile. You can claim this payment yourself or pay it to an employee if they’re travelling on behalf of the business. The approved mileage allowances set out by HMRC are as follows: 

  • 45p per mile for the first 10,000 miles driven in a vehicle 
  • 25p per mile after the first 10,000 miles driven in a vehicle 
  • 24p per mile for motorcycles 
  • 20p per mile for bicycles, pedal power or electric

Our recommendation is to always claim back AMAPs instead of petrol costs. This is often a slightly more generous payment as it’s designed to cover additional costs like wear and tear, insurance and repairs, all of which you’ll want to be taking into consideration if you use your personal vehicle for business. 

In addition to getting slightly more bang for your buck,  mileage usage is easier to calculate than petrol. If you fill up your tank before a journey, you’ll ultimately have to guess exactly how much petrol was used. HMRC doesn’t like guesses! Instead, we recommend downloading an app like Driversnote which automatically tracks your mileage and allows you to categorise it as either business or personal. No guessing necessary! 

Consider trading your diesel for an electric 

There are so many benefits to leasing an electrical vehicle for your business. Not only does it benefit the environment and boost team morale, it can also save you money. 

Electric car charging is exempt from Benefit in Kind tax for employees, as long as the charging point is situated in the workplace. Electric car charging cards can also be purchased by your team to allow access to local authority vehicle charging points, with no taxable Benefit in Kind.  

Still not convinced to give up your smelly diesel? Read about how making an impact helps us Thrive together.