➡️ Managing mileage expenses can often be complex, but with Spendesk’s streamlined approach, you’ll find it easier to track and calculate reimbursements accurately.
This guide will walk you through Spendesk's mileage and fuel calculation process, including recent updates for passenger reimbursements and company car fuel claims.
Navigating Mileage and Fuel Expenses with Spendesk: A Complete Guide
Mileage Reimbursement Rates
Spendesk aligns with the UK government’s official rates as the foundation for mileage reimbursements. The calculation is based on mileage thresholds:
Below 10,000 Miles
For distances below 10,000 miles, users are reimbursed at a rate of 45p per mile.
Above 10,000 Miles
For distances exceeding 10,000 miles, the reimbursement rate drops to 25p per mile, while the miles under 10,000 are still calculated at 45p per mile.
Example Scenario
Let’s consider Mark, a Spendesk user who owns a car. He has already driven 10,000 miles and received £4,500 (AMOUNT A) from his company, calculated at 45p per mile.
Now, if Mark drives an additional 30 miles, instead of the standard 45p rate, the 30 miles will be reimbursed at 25p per mile. The total reimbursement is calculated as:
£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 for the additional 30 miles driven.
Passenger Reimbursement
Spendesk allows customers on a GB mileage scheme to claim passenger reimbursements, aligning with HMRC guidelines. Companies should reimburse employees £0.05 per passenger per mile when traveling in their personal cars for business purposes.
How It Works:
On the web or mobile, users submitting a mileage request will be prompted to enter the number of passengers.
The updated reimbursement, including the passenger rate, will be reflected across all relevant Spendesk pages: the request approval page, expense claims, and Bookkeeping > Prepare.
Company Car Fuel Reimbursements
For those driving company cars, Spendesk now supports claims for fuel expenses related to business trips. These reimbursements follow the HMRC's Advisory Fuel Rates (AFR), which are updated quarterly.
How It Works:
When submitting a mileage request on web or mobile, users can indicate if they are travelling in a company car.
Users will be prompted to provide the car’s fuel type and engine size, as these factors influence the applicable rate.
All relevant information, such as whether the claim involves a company car, adjusted rates, fuel type, and engine size, will be visible across Spendesk's interface: the request approval page, expense claims, and Bookkeep > Prepare.
If the mileage claim is for a past date, Spendesk automatically applies the Advisory Fuel Rates applicable on the trip date, which may differ from current rates.
Submission and Reimbursement Process
Spendesk simplifies the submission and approval process for mileage and fuel reimbursement claims:
Submission
When a mileage or fuel claim is submitted, Spendesk estimates the reimbursement amount based on the applicable rates at the time of submission, as well as any previous mileage claims. This estimate remains static until the claim is approved.
Approval
Once a claim is approved, the reimbursement amount is updated to reflect the final rate, taking into account any adjustments due to mileage thresholds, rate changes, or fuel reimbursements.
Variations Between Estimated and Final Amounts
Differences between the estimated and final reimbursement amounts can occur for several reasons:
Reaching the mileage threshold during the claim approval process.
Rate changes (such as switching from UK rates to custom rates) that happen during the approval period.
Adjustments made to compensate for annual rate changes.
Compensation for Rate Changes
Spendesk ensures that any rate changes implemented by the UK, FR, or DE markets throughout the year are applied retroactively. This means that users are compensated for changes to mileage rates, and this compensation is reflected in subsequent claims.
Once the compensation is included in an approved claim, future reimbursements will follow the normal rate.