Accurate mileage capture is vital to satisfy tax inspectors

Mileage capture for companies and grey fleet drivers has always been important, keeping accurate mileage records has assumed greater relevance following news that HMRC have penalised companies consider to be keeping inefficient and inaccurate records

Fleet industry publication, Fleet News, recently reported that several firms had been fined four and even six figure sums by HMRC inspectors, after failing tax investigations. One company which ran a 100-plus car fleet was hit with a six figure tax settlement despite monitoring mileages through the use of spreadsheets, the publication reported.

Tax inspectors typically plan to visit firms at least once every six years to ensure their records are accurate and up to date. They will want to look at all records including payroll, expenses, mileage records, credit card statements and even petty cash.

This means that the accounts department and HR are generally first ports of call and an inspection will typically last a couple of days, although it could be longer for a large company. However, if any issues are found then the inspection could take up to 12 months, requiring several visits.

Keeping a check that all of the requirements to pass a tax inspection normally falls on the accounts department, the fleet manager and often the HR department, and can be time consuming and burdensome.
Automated business mileage and expenses capture is vital to ensure the company remains compliant with HMRC regulations.

In addition, it allows accurate mileage expenses to be reimbursed and also allows company managers to assess the risks associated with high mileage drivers as well as flagging up vehicle servicing in advance.

Mycompanyfleet has software solutions designed to tackle all of these issues. Automated business mileage capture is achieved through the intuitive Mycompanyfleet Driver Self-Serve web portal which requires drivers to enter their mileages and vehicle condition online into the system.

Driver Self-Serve gives companies the means to completely automate the management of their company car and grey fleets, those owned by employees but regularly used on company business.
 
Drivers log on to the Driver Self-Serve portal and enter their current business mileages and their mileage expenses claims online. In doing so, they are signing an agreement that they accept the company’s terms and conditions and that they have had their vehicle serviced in accordance with the manufacturer’s approved service schedule, or with the company’s own bespoke servicing schedule.

Once the vehicle details and business mileages are entered by the driver, the fleet software system compares them against the manufacturer’s approved service schedule, and the company conditions, for the vehicle in question.

It then proactively informs the driver of the number of miles left before the next service or the next check and when the vehicle will need to be booked in for the service to be carried out.

If drivers fail to update their details, they will be unsuccessful in their mileage expenses claim, which acts as a major incentive for them to keep records accurate and up-to-date. They are also automatically flagged up in an exception report to the fleet manager for further action to be taken.

Used in this way, the system provides the fleet manager with a confirmation that a service has taken place and a record of the date, in an easily visible audit trail that meets duty of care requirements.

When it comes to verifying driver details, Mycompanyfleet offers an enhanced driver checking service which was developed to meet demand from corporate customers who wanted to go further into the backgrounds and credentials of their drivers.

The service not only checks and validates driver licence status, but also carries out deeper background checking of a driver’s qualifications, references and even criminal records.

The findings feed automatically into Mycompanyfleet software to produce integrated driver records in one place which can be accessed by multiple departments, including the fleet department and Human Resources.
 
What this does is provide a one-stop shop of all driver records, along with improved management of vehicle and driver alike and the creation of a central and readily accessible source of driver information for various departmental managers.

It is also perfect in creating a clear and transparent audit trail for HMRC inspectors to follow in the event of a tax inspection.
 

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