Mileage reimbursement works slightly different depending on which country you do business in. Find mileage reimbursement calculators for both the US and UK below:
What is mileage reimbursement?
Mileage reimbursement is the amount per mile a person can claim from their employer for using their personal vehicle for a business trip.
The figure is based on the distance travelled in the vehicle, and doesn’t include other expenses that may occur along the way such as: parking fees, food and overnight stays, charges for using toll roads etc.
Travelling to a regular place of work does not count as a business trip.
Standard mileage rates
Standard mileage rates are used to calculate approximately how much it would cost for the average car to travel a mile, this includes costs such as fuel, wear and tear and insurance.
The amount per mile you can be reimbursed is dependent on the figures given from your workplace or from your government, each country or state has different regulations which you will need to research prior to making your calculation.
The amount per mile you can be reimbursed is not related to the type of car, or the age of the car you’re using.
In 2020 the IRS published the standard mileage rates for 2020 which states that:
- 57.5 cents per mile for business use
- 17 cents per mile for medical or moving purposes
- 14 cents per mile in service of charitable organizations
In the UK, HMRC mileage and fuel rates haven’t changed since 2011, which still stands at for the first 10,000 miles:
- 45p per mile for cars and vans
- 24p for motorcycles
- 20p for bicycles
How to calculate mileage reimbursement
Calculating how much you can be reimbursement for your business mileage is simple to do.
Firstly, you’d need to make a note of the total miles travelled for the business trip, and this figure is then multiplied by the cost per mile set out by your government.
For example, if you’ve travelled 500 miles for a business trip in a car and you live in the UK, you’d calculate 500 * 45p, which would give you £225.
If you’re from the US, your cost per mile is 57.5 cents because your trip is for business use. You’d multiply 500 by 57.5 cents, which would give you $287.50.
However, if out of the 500 miles, 100 miles was for medical purposes then you’d need two calculations. 400 miles based on business use, and 100 miles based on medical.
- 400 * 57.5 cents = $230
- 100 * 17 cents = $17
- Total mileage reimbursement = $247
Here is the calculation:
Miles travelled * cost per mile = mileage reimbursement
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