Mileage Claims: Can You Claim For Your Work Commute?

can I claim mileage for traveling to work

If you use your own vehicle for work, you may be able to claim tax relief on the miles you travel. The rules for claiming this relief vary depending on your employment status and the country in which you live. In the US, self-employed individuals can claim a mileage deduction for business, charity, medical, or moving purposes. This deduction can reduce your taxable income and lower your overall tax liability. In the UK, employees can claim tax relief on their mileage if they are not reimbursed by their employer.

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The standard mileage rate method

To use the standard mileage rate method, you must own or lease the car and:

  • Not operate more than five cars at the same time
  • Not have claimed a depreciation deduction for the car using any method other than straight-line
  • Not have claimed a Section 179 deduction on the car
  • Not have claimed the special depreciation allowance on the car
  • Not have claimed actual expenses after 1997 for a leased car

If you own the car, you must choose to use the standard mileage rate method in the first year the car is available for business use. In later years, you can switch between the standard mileage rate method and the actual expense method. If you lease the car, you must use the standard mileage rate method for the entire lease period, including renewals.

If you qualify for both the standard mileage rate method and the actual expense method, you should calculate your expenses using both methods and then choose the one that gives you the largest deduction.

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The actual expenses method

To use this method, you must first add up all the costs you spend on your car. These include:

  • Depreciation
  • Gas
  • Insurance
  • Repairs
  • Lease payments
  • Maintenance (e.g. oil changes, brake pad replacements, tire rotations)
  • Title, licensing, and registration fees

Then, you multiply this by the percentage of time you drove your car for work (also known as your "business-use percentage"). For example, if half the miles you drive are for business, you multiply your total vehicle expenses by 50% to arrive at the business portion.

If you are self-employed and use your vehicle for work, charity, medical, or moving purposes, you might be able to take a mileage deduction for the self-employed. This deduction can reduce your taxable income and minimize your total tax liability.

It's important to note that you cannot claim both the actual expenses and mileage tax for a single vehicle in the same year.

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What counts as business mileage

The Internal Revenue Service (IRS) defines business mileage as the distance travelled between two places of work, permanent or temporary. This includes:

  • Travelling between your main job and a temporary work location.
  • Travelling directly from your main job to a second job.
  • Travelling between a temporary work location and your second job.
  • Getting from your home to a temporary workplace if your regular job is at another location.

Business mileage does not include travelling between your home and your main job or your second job.

The IRS has determined that if you want to claim the standard mileage deduction, you need to be the owner of the vehicle you use or at least be leasing it. If you are the owner, you must use the standard mileage rate during the first year of using the vehicle for business. After that, you can choose between the standard mileage rate and the actual expense method.

If you are leasing, you must use the standard mileage rate in the first year of business using your car and continue using this method for the whole life of the lease, even if you renew it.

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Mileage deduction rules for the self-employed

If you are self-employed and use your vehicle for work, you can claim a tax deduction on your business-related driving. The IRS classifies the following trips as tax-deductible:

  • Driving between two different workplaces
  • Driving from your home to a temporary workplace (a workplace is generally defined as temporary if you expect to work there for less than a year)
  • Meeting clients and visiting customers
  • Running business-related errands

The types of trips that aren’t considered business mileage include:

  • Commuting to and from your home to your permanent workplace
  • Commuting to and from your home to a second workplace

There are two methods for calculating your mileage deduction: the standard mileage rate method and the actual expenses method.

Standard Mileage Rate Method

The standard mileage rate method uses a set IRS rate you can apply to calculate tax deductions per business mile driven. This method is more straightforward than working out actual expenses, as the rate covers all expenses of owning and running your vehicle for business purposes.

With the 2024 IRS mileage rate, you can claim $0.67 per mile for business-related driving. The IRS mileage rate for 2023 is $0.655 per mile.

To qualify for the IRS standard mileage rate method, you must own or lease the car(s) you drive for business. If you want to use the standard mileage rate, you must choose it in the first year of the car’s operation in your business. In later years, you can switch to actual expenses. However, this method is not available if you:

  • Claimed depreciation deductions on the car (other than the straight-line method)
  • Claimed a section 179 deduction or the car's special depreciation allowance
  • Simultaneously use five or more vehicles for your business (fleet operations) – however, you may switch between the vehicles
  • Are a rural mail carrier who receives a qualified reimbursement

When leasing, you must commit to the standard mileage rate method for the entire lease period. This method is not applicable if you:

  • Simultaneously use five or more vehicles for your business (fleet operations) – however, you may switch between the vehicles
  • Claimed actual car expenses for a leased car after 1997

Actual Expenses Method

As a self-employed person, you can claim deductions for expenses related to owning and operating a vehicle for business purposes. The IRS identifies deductible expenses as:

  • Depreciation or rental and lease payments
  • Parking fees and tolls
  • Trailer rental costs (when hauling tools or instruments)
  • Interest payments on your personal car loan

There are three types of depreciation that, if taken, might disqualify you from switching to the standard mileage rate method: the Section 179 Deduction, the Depreciation Deduction, and the Special Depreciation Allowance.

If you choose to use the actual expenses method in the first year your vehicle is available for use in your business, you won’t be able to apply the standard mileage rate method in any following year while you drive that vehicle. However, if you use the standard mileage rate method in the first year, you can choose between the two methods in the following tax years.

Record-Keeping

For the standard mileage rate method, you must keep a timely log of your business mileage. The IRS considers a log to be timely if it’s updated on a weekly basis. The log should contain details of each business and personal trip, including:

  • Starting and ending mileage
  • Date
  • Destination
  • Reason for travel
  • Any tolls or other trip-related costs

For the actual expenses method, you must also keep a timely log of your mileage, as well as maintain documentation and hold onto all receipts associated with owning and running your vehicle to claim actual expenses.

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Mileage deduction rules for other employees

As an employee, you can take a mileage tax write-off using Form 2016 to report miles and answer vehicle-related questions. The same mileage deduction rules for the self-employed apply to all other employees.

  • Trips from one office to another: You can deduct any miles incurred as a result of travelling from your office or work site to a second work location.
  • Temporary work location: If you have a regular workplace in addition to a temporary work site, you can deduct any mileage between your home and the temporary location.
  • Customer and client visits: Any mileage driven from your office to meet with customers, clients or business vendors can be deducted.
  • Business-related errands: Miles incurred while running any business-related errands (e.g. trips to the bank, post office, etc.) can be claimed.
  • One-off/secondary jobs: Any travel incurred while working secondary jobs to make some extra cash (e.g. landscaping or housesitting) can be written off, as long as it is not a day off from your main job.
  • Job seeking: Any miles driven to find a new job in your current occupation are eligible for a deduction, as long as you’re not looking for your first job.
  • Medical appointments: This includes driving to and from doctor’s appointments or picking up prescriptions.
  • Volunteer work: If you volunteer for a charity and need to use your vehicle to get there or to participate in the charity work itself, you might be able to claim the tax deduction.

It is important to note that employees can only claim business mileage. The IRS considers any travel from your home to a permanent work location to be a commute, and therefore not eligible for a deduction.

You can claim a certain amount of cents per mile as part of unreimbursed employee expenses, but only expenses over two percent of your adjusted gross income can be deducted.

Frequently asked questions

No, the IRS considers any travel from your home to a permanent work location as a commute. However, if you are travelling to a temporary work location, you may be able to claim a deduction.

A temporary work location is somewhere you work for no more than 24 months.

There are two methods: the actual expenses method and the standard mileage rate method. The former allows you to claim deductions for all expenses related to the operation of the car, while the latter allows you to claim a deduction per mile driven for business purposes.

You will need an accurate record of your mileage, as well as pay slips or timesheets showing the number of miles driven.

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