Navigating mileage expenses can be tricky, but with this guide, you'll grasp Spendesk's approach to mileage calculation, ensuring clarity and accuracy in your reimbursements.
Spendesk aligns with the UK government's official rates as the basis for its calculations (Source).
Below 10,000 Miles: For distances below 10,000 miles, users are reimbursed at a rate of Distance (miles) × 45p.
Above 10,000 Miles: For distances exceeding 10,000 miles, the rate shifts to 25p per mile, subtracting what has already been reimbursed for the miles under 10,000 miles, calculated at 45p per mile.
Example Scenario: Let's consider a user named Mark who owns a car. He has already received £4,500 (AMOUNT A) from his company via Spendesk for driving 10,000 miles, calculated at 45p per mile. Now, if he drives an additional 30 miles:
Previously, Mark would expect to receive £13.50 (30 miles × £0.45).
However, with a total annual mileage of 10,030 miles, Mark's reimbursement would be recalculated as follows:
£4,500 (AMOUNT A) + (£30 × £0.25) = £4,500 + £7.50 = £4,507.50 (AMOUNT B).
➡️ Mark will receive the difference between AMOUNT B and AMOUNT A, which is £7.50.
Submission and Reimbursement
Submission: Upon claim submission, Spendesk estimates the reimbursement amount based on the applicable rate and previously approved mileage claims. This estimated amount remains static until the claim is approved.
Approval: Upon approval, the reimbursement amount is updated to reflect the final amount, considering the rate in effect at the time of approval. Changes between the estimated and final amounts can occur due to various reasons outlined below.
Reasons for variation between estimated and final amounts
if mileage thresholds are reached during the claim approval process.
Rate changes occurring during the claim approval process (from UK rates to custom rates for example)
Compensation for rate changes implemented during the year ⬇️
Compensation for Rate Changes
When annual rates are updated on the FR, UK, DE markets, retroactive adjustments are made to reimbursements for claims made since the beginning of the year.
Compensation for rate changes is reflected in subsequent mileage claims until one of them is approved, after which reimbursement returns to normal.