The HMRC 10 mile rule states that if a journey is similar to a normal commute or along the same route, then the cost of the travel is not deductible and the employee cannot claim mileage expenses.
HMRC created this rule to ensure that mileage claims are made correctly when employees travel to a temporary workplace. This is because the journey is considered to be an ordinary commute journey rather than a business journey.
HMRC has clearly defined permanent and temporary workplaces as well as what distinguishes an ordinary commuting journey from a business trip. Read more about this here: What is Business Mileage?.
The application of the HMRC business mileage 10 mile rule depends on the particular scenario. We’ve illustrated some common cases below.
Visiting a shop near the permanent workplace:
A sales manager lives in Manchester and works in an office in Liverpool. His office is 500 yards from a shop that he will visit for a meeting. He drives from his home to the shop directly.
The journey to the shop is classified as a normal commute. Although the shop is a temporary workplace, the journey is almost the same as his usual commute. Therefore, the cost of the travel is not deductible and he cannot claim mileage expenses or tax relief.
Visiting a factory over 10 miles away from the permanent workplace:
A health and safety inspector normally drives 9 miles to go to her office, which is her permanent workplace. One day, she visits a biscuit factory to conduct an inspection. The factory is 11 miles further than her office. She drives to the factory along her usual commute, passing her permanent workplace. The journey is 20 miles in total.
As the extra journey distance is more than 10 miles longer than her usual journey to her permanent workplace, it is not considered to be a normal commute. The employee is therefore entitled to claim mileage allowance relief.
Visiting a client’s office located near the permanent workplace:
An HR consultant normally drives 9 miles to her office, which is her permanent workplace. One day, she has to visit a client for a meeting. The client’s office is 1 mile from her permanent workplace. Her journey to the client’s office is the same length as her usual commuting journey and is in the same direction, although she takes a slightly different route.
The client’s office is a temporary workplace. As the employee’s journey to the temporary workplace is almost the same length and direction as her usual commute, she is not able to claim a deduction on business mileage, even if she takes a different route.
3 key points about the HMRC 10 mile rule:
- If an employee’s journey from their home to a temporary workplace is not within a 10 mile radius of their permanent workplace, the cost of the travel is deductible and mileage relief can be claimed.
- If an employee travels from their home to a temporary workplace within a 10 mile radius of their permanent workplace, HMRC considers this to be an ordinary commuting journey and business travel expenses are not tax-deductible.
- A journey in the same direction of the employee’s permanent workplace that is roughly the same length as their normal commute is considered to be a normal commute even if the employee takes a different route.
How can I learn more about mileage claims?
There are a lot of HMRC rules to understand when it comes to recording business mileage and managing mileage claims. Reading through all the information on different websites can get confusing, which is why we have put together a complete guide to mileage claims, where our experts at Autotrip go through everything that you ought to know.
How do I make sure I’m recording my business mileage correctly?
Here at Autotrip, we have developed a solution that helps businesses track their business mileage automatically.
Our plug and play GPS mileage tracker captures every drive which our software then shows on a map.
This makes it easy to classify trips as either business or personal and you can also see how business trips differ from ordinary commuting journeys.
Our software also automatically calculates the mileage and VAT amount that businesses can claim back, based on up-to-date HMRC mileage rates.
Find out how we make mileage simple at autotrip.com and see how we’ve recorded over 7.8M miles and 482,000 business trips in the past year, saving our clients 1000s of hours that would have been otherwise spent logging mileage manually.