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1.1 or 2 Motor Business Miles? To Round Up or Not?

That Is The Question! (Milometer - Odometer Blues).

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Dealing with self employed expenses claim. Client is EXTREMELY accurate and tidy.

But this reminded me of when I was a young whippersnapper working for a firm of accountants, and put in a claim for the 6.1 mile round trip to bank the firms takings at lunchtime.

On presenting my expenses claim for 6.1 miles @ 25p per mile I was repremanded by the accounts clerk and forcefully told to ROUND UP the miles to 7. This cut against the honest grain in my body which runs through it like the writing on a stick of Blackpool Rock.

But this client's mileage log shows hundreds of daily trips out in the car during the year. Many of the trips are for 2.1 or 3.1 or 5.1 or 10.1 or 21.1 miles etc. I was about to advise the client to round up each day's trip.

However, the annual log which totals 2,996.4 miles is a very accurate figure. It has just dawned on my that I may be about to advise the wrong thing. Should I let sleeping dogs lie, or should I advise to round each trip up to the next whole number.

All of my other clients round up automatically. Maybe the transition from dead accurate mileage to rounding up should be a "rite of passage" for everyone.

What you think?

 

Replies (38)

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By thevaliant
14th Jul 2020 14:19

I've always claimed to .1 mile, and not rounded. Wouldn't do anything else.

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By Anonymous.
14th Jul 2020 14:31

Don't see how you can round up. If you travel 6.1 miles you have driven 6 miles but not 7.

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Replying to Anonymous.:
By penelope pitstop
15th Jul 2020 01:19

So, no tax allowance for 0.1 of a business mile.

Shall have to start driving as the crow flies!

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Replying to penelope pitstop:
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By Anonymous.
14th Jul 2020 15:09

penelope pitstop wrote:

So, not tax allowance for 0.1 of a business mile.

Shall have to start driving as the crow flies!

Think you could claim 0.1 just not the 1 (ie 0.9 extra).

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Hallerud at Easter
By DJKL
14th Jul 2020 14:45

Surely one rounds down below 0.5 and up re 0.5 and over?

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Replying to DJKL:
By penelope pitstop
14th Jul 2020 15:03

Certainly so in elementary maths class, but what about the world of tax?

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Replying to DJKL:
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By Vallery Lee
15th Jul 2020 13:35

Why not round up or down totals at the end of each month/quarter which would be more logical

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Replying to Vallery Lee:
By penelope pitstop
15th Jul 2020 13:43

Ah! The old "roller-coaster" method of mileage record-keeping.

It's okay until the wheels drop off!

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By Mr_awol
14th Jul 2020 15:21

I would normally round up to the nearest whole mile, safe in the knowledge that it probably doesn't make a whole lot of difference in the grand scheme of things. If going on a round trip I would generally only make a note of the mileage one way, and double it to get my claim.

For clients id suggest they do whatever suits them. If they want to track it on an app, etc then by default you will have a very exact figure so I'd say use it. Otherwise I would say just keep a log and accept whatever rounding they chose to use (as long as it was only up/down to the nearest whole number).

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Replying to Mr_awol:
By penelope pitstop
14th Jul 2020 15:31

At last. The voice of reason!

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Replying to Mr_awol:
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By Paul Crowley
14th Jul 2020 21:04

Same here

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By Tax Dragon
14th Jul 2020 15:26

Use kilometres.

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Replying to Tax Dragon:
By penelope pitstop
15th Jul 2020 01:18

I do when using my imported Japanese Honda Pantzz.

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Replying to Tax Dragon:
Hallerud at Easter
By DJKL
14th Jul 2020 15:57

I do.

My Satnav is programmed into kms and tells me speed/distance in kms, on long journeys the distance still to go in kms just feels more like you are making progress, at 120kmph dropping two a minute is very satisfying (75mph).

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Replying to DJKL:
RLI
By lionofludesch
14th Jul 2020 17:44

DJKL wrote:

I do.

My Satnav is programmed into kms and tells me speed/distance in kms, on long journeys the distance still to go in kms just feels more like you are making progress, at 120kmph dropping two a minute is very satisfying (75mph).

Yes - drive up the M1 and, when you cross the border, you take a quantum leap towards Belfast.

Not quite so satisfying heading south.

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By paulwakefield1
14th Jul 2020 20:50

Can't see the point of measuring to the nearest 0.1 given the inherent inaccuracies in odometers and GPS - spurious accuracy. OK if you're just trying to establish a percentage I suppose.

Thanks (3)
RLI
By lionofludesch
15th Jul 2020 07:15

As someone involved in motor racing, Penny, you should be aware that odometers aren't all that accurate anyway. They depend in random factors such as tyre pressures.

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Replying to lionofludesch:
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By Tax Dragon
15th Jul 2020 07:43

Much prefer the word "odometer". Every time this thread pops up with its "milometer" heading my brain simultaneously sees it as "millimetre" and "kilometre" and momentarily fuses.

Plus I'm wondering whether "kilometrometer" is a word.

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Replying to Tax Dragon:
Hallerud at Easter
By DJKL
15th Jul 2020 09:21

If it is not it ought to be.

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Replying to DJKL:
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By Tax Dragon
15th Jul 2020 09:47

In the US, it'd presumably be spelt kilometerometer.

And my brain's fused again.

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By Bruce Roberts
15th Jul 2020 09:51

Pretty sure some of our clients round up to the nearest 10 miles (or more!).

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By john hextall
15th Jul 2020 10:07

For an odd, one-off claim of 6.1 miles, I would call it 7. But for regular, detailed claims greater accuracy is required otherwise by the end of the year, the miles claimed will exceed the miles driven by several hundred.

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Replying to john hextall:
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By Mr_awol
15th Jul 2020 13:44

john hextall wrote:

for regular, detailed claims greater accuracy is required otherwise by the end of the year, the miles claimed will exceed the miles driven by several hundred.

And still nobody will care.

We send staff to courses 'about' 50 miles from the office. There are three possible routes they could take, and in fact the way back is slightly longer than the way there, due to a one-way system. Sometimes they go straight from home. Sometimes they jump in the car at lunch time and go to the services (or a local pub) for refreshments other than the coffee and biscuits provided on the courses.

If we ever checked it, then as long as it was +/- a few miles, we wouldn't challenge them. And that's when we are paying the actual cash. If we are talking about tax relief on a couple of hundred miles then it's of even less importance.

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Replying to Mr_awol:
By penelope pitstop
15th Jul 2020 14:11

One of my old bosses started checking the "official" route miles according to Google. He would then override the mileage claims handed in by the "clever" young lads who were always trying to "pull a fast one" over their employer.

Caught them out numerous times!

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Replying to penelope pitstop:
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By Mr_awol
15th Jul 2020 15:52

When I was a 'yoof' making 'enthusiastic' mileage claims I was lucky in that I was on a secondment to various other divisions. My own bosses didn't know where I was half the time and the bosses paying out my claims didn't know where I'd come from. In addition to that, there was no detailed claim required - I just had to write the total number of miles and the total parking/tolls on a piece of paper and collect payment in cash, paid weekly.

I was generally put up in accommodation fairly locally but I suspect I could have overclaimed by several hundred miles every single week and nobody would ever have found out.

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Pile of Stones
By Beach Accountancy
15th Jul 2020 10:10

Back when I had to deal with mileage claims, it was only the accountants who bothered claiming the 0.1's anyway.

Everybody else gave us round numbers!

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Replying to Beach Accountancy:
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By Mr_awol
15th Jul 2020 13:48

When I was making regular claims from an employer it went something like:
- Note actual mileage (one way)
- Add a couple of miles (feasible if different route taken)
- Add a couple of miles for wrong turns/getting lost (can happen, hypothetically)
- Subtotal
- Multiply by two for round trip
- Claim

The additional pretend miles would typically be capped at around 5% of the genuine claim, so as to avoid taking the [***].

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By C Graham
15th Jul 2020 10:24

Hard to prove whether a claim was slightly inaccurate surely. Driving around looking for a parking space can alter the figure.

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By pauljohnston
15th Jul 2020 11:04

You could tell him to carry on as before and you round up the total rather than each entry. Otherwise round rather than round up

But as others have said the amounts are just not worthwhile.

Tell him there is an extra charge if round mileage figures are not provided.

Thanks (4)
By penelope pitstop
15th Jul 2020 12:52

I suppose we should all follow the lead of HMRC staff.

I wonder what they put on their mileage claims.

I would reckon it is probably rounded up miles for each individual trip.

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Replying to penelope pitstop:
RLI
By lionofludesch
15th Jul 2020 13:02

penelope pitstop wrote:

I suppose we should all follow the lead of HMRC staff.

I wonder what they put on their mileage claims.

I would reckon it is probably rounded up miles for each individual trip.

Ach - just keep your tyres soft and you'll be happier to round it down.

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Replying to lionofludesch:
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By ruth.julian
15th Jul 2020 14:15

Used to be the exact mileage. I got my claim knocked down because boss's car odometer showed 6.1 miles and my moped showed 6.3. :)

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Replying to ruth.julian:
RLI
By lionofludesch
15th Jul 2020 14:19

ruth.julian wrote:

Used to be the exact mileage. I got my claim knocked down because boss's car odometer showed 6.1 miles and my moped showed 6.3. :)

Tie a tape measure to the back of your moped and fasten the end of the tape to your start point.

Read off the distance when you arrive and reel it in.

Job done.

Works best over short distances.

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By C Graham
15th Jul 2020 13:48

the amounts involved are petty cash - really would cost more in admin time to debate with clients than just to tally up - and most presumably would be expense reclaimed. It would be like asking for receipts for coffees paid with contactless - there won't be any but the amounts are so tiny they are irrelevant.

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By Mr_awol
15th Jul 2020 14:01

I have in the past taken on several clients from a local firm (who have now sold out to another practice) who used to advise clients to keep a mileage log for a specimen two week period each year - and who used to then extrapolate that to give the basis of an annual claim.

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Replying to Mr_awol:
RLI
By lionofludesch
15th Jul 2020 14:14

Mr_awol wrote:

I have in the past taken on several clients from a local firm (who have now sold out to another practice) who used to advise clients to keep a mileage log for a specimen two week period each year - and who used to then extrapolate that to give the basis of an annual claim.

Better than nothing.

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By penelope pitstop
16th Jul 2020 13:07

All of the above comments go to prove that even at this most basic level of tax business mileage record keeping there is a strong divergence of opinion. In the real world it is highly unlikely that HMRC would split hairs, although the VAT department of HMRC have the resources to officially "split hairs" if they want to do so.

The claiming of excess expenses from employers is a related but slightly different issue. The stories are somewhat humorous, but at the end of the day inflated expense claims are fraudulent and are sackable offences.

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Replying to penelope pitstop:
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By C Graham
16th Jul 2020 15:00

er, well most posters agreed on one thing - that the amounts involved in this context are too insignificant to make it an issue.

Seriously I think HMRC have bigger problems to worry about whilst they try to retrieve the bailout costs to the country than how mileage is rounded!

It would cost more in postage to send the letter and in any case would be extremely difficult to prove if a claim was 'inflated' in terms of rounding up mileage to the nearest mile!

Your clients will probably not thank you for spending your time (and their money) probing these sorts of minuscule details on expense claims.

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