Mileage claims for sales representative jobs

A sales representative can clock up hundreds or even thousands of business miles a year, especially if his area of operation covers a large area. Being able to visit your customers, meet new clients and keep in touch with all the people who make your business successful is an incredibly important part of the job, so many sales personnel find themselves travelling thousands of miles each year in order to fulfil the requirements of their role. Many sales reps will benefit from a company car and fuel allowance, but some will use their own car and be reimbursed by their company at a certain rate per mile travelled. For those who fall under the latter category, it is important to understand the tax implications of the system to ensure that they don’t overlook any liability they have in that respect.

Tax allowances

For sales representatives who travel using their own car, Her Majesty’s Revenue and Customs (HMRC) allows a rate of 45 pence per mile for eligible travel, which includes the cost of fuel and a proportion that goes towards wear and tear of your vehicle and the associated maintenance costs. If you are reimbursed for mileage by your company at a rate of 45 pence per mile or less, then you will not be liable to pay tax on this sum. However, if your employer gives you an allowance that exceeds this amount, then you will have to declare it and pay tax on any profits you make from it.

How to calculate

For those who are reimbursed for their mileage, it is important to keep accurate records of how far you travel. Some sales personnel are based at home, but spend most of their time on the road, in which case there is a possibility that all of their miles would count for the purposes of declaring them. However, sales staff who are office based but still travel for their work will need to deduct the number of miles that their normal commute would take. This means that an office-based worker who has a commute of 20 miles, but goes to see a client who is 50 miles away, would only claim for the difference between his normal commute and the distance travelled (i.e., 30 miles).

Use our free calculator to find out how much income tax you could be entitled to reclaim.

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