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Interactive Diagnostic

Stratford-upon-Avon

13 The Courtyard
Timothy's Bridge Road
Stratford-Upon-Avon
Warwickshire CV37 9NP

01789 294484

enquiries@gjassociates.co.uk

London

7-8 Stratford Place
Mayfair
London
W1C 1AY

0207 495 0304

enquiries@gjassociates.co.uk

Tax-free mileage expenses

If you use your own vehicle for business journeys, then you may be able to claim a tax-free allowance from your employer known as a Mileage Allowance Payment or MAP. The allowance is paid when employees use their own car, van, motorcycle or bike for work purposes. It is important to note that this tax-free allowance is not available for journeys to and from work but is available where employees use their own vehicles to do other business-related mileage. 

Employers usually make payments based on a set rate per mile depending on the mode of transport. There are approved mileage rates published by HMRC. For cars, the approved mileage allowance payment for the first 10,000 business miles is 45p per mile and 25p per mile for every additional business mile. An equivalent payment of 20p per mile is available for bicycle travel and 24p per mile for motorcycle travel. These rates have been fixed for many years and HMRC has confirmed that they will continue to apply for the current 2022-23 tax year.

If an employee travels with business colleagues, they can claim an additional 5p per passenger per business mile for each qualifying passenger. Where an employer pays less than the published rates, the employee can make a tax relief claim for the shortfall using Mileage Allowance Relief (MAR). There is no equivalent to MAR for passenger payments, which means that if the employer pays less than 5p per mile to carry a passenger, the driver cannot claim any tax relief on the difference.

Please note that if employees are paid more than the approved mileage rates then the excess is treated as a Benefit in Kind. Conversely, if employees are paid less than the published rates, they can make a tax claim for the shortfall using Mileage Allowance Relief (MAR). There is no equivalent to MAR for passenger payments.

Grenfell James Technology Adoption Index

How does your business perform against others adopting financial tech? Find out with our interactive diagnostic:

1.

How does your business receive invoices?

A)

Invoices are mainly received in paper form

B)

Invoices are mainly received by email

C)

Invoices are emailed then automatically forwarded to a designated mailbox

2.

How are purchase invoices processed?

A)

Invoices are entered manually

B)

Invoices are attached to manually raised invoices

C)

Automated software (e.g. ReceiptBank, 1Tap, HubDoc etc) collates invoices

3.

How are accounts processed?

A)

Using Excel/paper-based

B)

Using Computer-based, offline software

C)

Using cloud-based accountancy software

4.

How often is business data revised?

A)

Data is updated annually

B)

Data is updated quarterly

C)

Data is updated monthly or more often

5.

How is banking updated for your business?

A)

Banking is updated manually

B)

Banking is updated by imports

C)

Banking is updated via a live feed

6.

How are bank payments made?

A)

Bank payments are manual

B)

Bank payments are made using bulk imports

C)

Bank payments are made directly via accounting software

7.

How are bank receipts reconciled?

A)

Receipts are chased and reconciled manually

B)

Receipts are chased and reconciled automatically

C)

A third-party platform is used to chase debts and collect fees

8.

How often are management reports produced?

A)

No reports are provided

B)

Reports are provided but often too late to be valuable

C)

Reports are automated with real-time information

Score 8-12:

Curious Exploration

Your financial technology phase is Curious Exploration

% of respondent businesses are in this phase too.

Switching accountancy systems may seem like an upheaval, but can be much more straightforward than most businesses imagine. From talking to our clients, they have found moving from paper invoicing and desktop-based accounting software to the cloud and apps quickly makes the transition process a worthwhile investment of time. Digital accounting solutions bring in streamlined processes, up-to-date business data and greater confidence in the accuracy of information when making financial decisions.

Grenfell James works with your team to fully assess the needs of your business and minimise the impact of any transitions for solutions we recommend.

Find out more about App Advisory

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Score 13-19:

Measured Discovery

Your financial technology phase is Measured Discovery

% of respondent businesses are in this phase too.

Once cloud accountancy software is in place, there’s still plenty of scope to improve your accountancy processes and make sure your business is maximising the benefits of adopting a digital accounting solution. Grenfell James assesses each business to understand how any implemented solutions are being used, identify areas for improvement and the needs of the business overall to support your business goals and achieve success.

Our team of experts can discuss a range of time-saving automation and get different apps and cloud-based solutions talking to create and manage a digital accountancy eco-system to help your business grow.

Find out more about App Advisory

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Score 20-24:

Bold Innovation

Your financial technology phase is Bold Innovation

% of respondent businesses are in this phase too.

You know the benefits of accounting technology and the impact it can have on your business goals. If you want to take it a step further, our team can conduct a systematic review of your processes, apps and business goals to ensure your digital accountancy ecosystem is keeping pace with the changing needs of a growing business.