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Could your fleet face £34,000 fines? Expert advice on mileage tracking and HMRC compliance

Fleet Managers face significant financial risks if they fail to meet HMRC’s mileage tracking requirements.
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6 February 2025

With potential fines of up to £34,000 per vehicle, businesses must ensure full compliance, or they could face substantial penalties that can be backdated for up to six years. Proper mileage tracking is not just about avoiding fines—it also provides an opportunity to streamline operations and reduce administrative overhead.

Why fines happen

HMRC fines typically arise when companies fail to accurately distinguish between business and private use of company vehicles. Under Benefit in Kind (BIK) rules, businesses must declare and pay taxes on vehicles used for significant private purposes, such as holidays or regular personal use. Even infrequent private trips, if not properly logged, can lead to penalties.

However, insignificant private use—such as a quick detour for personal errands—can be exempt, provided the business maintains accurate records to prove the nature of the trip. Without this level of documentation, businesses face a greater risk of HMRC audits, which can result in costly fines.

Craig Allan, Director of Specialised Sales at ABAX, explains:

“Accurate record-keeping is not just essential for avoiding fines, it’s crucial for optimising fleet operations and improving efficiency.”

What HMRC requires for compliance

To comply with HMRC’s strict guidelines, businesses must maintain detailed mileage logs for every vehicle trip. These logs should include the following information:

  • Vehicle details: Registration, make, model, fuel type, and engine size.
  • Driver information: Name of the person driving the vehicle.
  • Trip details:
    • Start and end locations with postcodes.
    • Start and closing mileage for each trip.
    • Purpose of the trip: For example, a client visit or delivery.

Failing to keep these records can leave companies exposed to penalties during an audit. Manual logs, prone to human error, can be especially risky if details are incomplete or inaccurate.

Automating compliant digital mileage logs

Automated tracking systems like ABAX Triplog make it easier for businesses to maintain compliance with HMRC’s requirements while also streamlining operations. ABAX Triplog provides:

  • Real-time, automatic mileage tracking using GPS technology, ensuring that no trip details are missed.
  • Paperless mileage reports, eliminating the need for manual entry and reducing the risk of human error.
  • Seven-year data storage, which allows businesses to easily access records for audits, ensuring full compliance with HMRC’s requirements.

As Craig points out:

“By automating mileage tracking, businesses not only ensure compliance, but also save time and reduce administrative burden, allowing Fleet Managers to focus on more strategic tasks.”

Automating reports: save admin time and prevent manual errors

One of the greatest benefits of an automated system like ABAX Triplog is its ability to generate comprehensive mileage reports automatically. This eliminates the need for Fleet Managers to manually log every journey, significantly reducing admin time and preventing manual errors that can lead to costly fines. The system ensures accurate records are always available, safeguarding the business from HMRC penalties.

Going beyond compliance with ABAX Fleet

While ABAX Triplog handles mileage tracking and compliance, ABAX Fleet provides a comprehensive solution for fleet management. It goes beyond basic tracking, offering advanced features that improve fleet performance:

  • Driver behaviour monitoring: ABAX Fleet tracks driving habits such as speeding, harsh braking, and excessive idling. These insights help Fleet Manager s identify and correct poor driving practices, which can lower maintenance costs and improve safety.
  • Fuel efficiency: ABAX Fleet provides real-time insights into fuel consumption, helping Fleet Manager s optimise routes and reduce unnecessary mileage, leading to lower fuel costs.
  • Predictive maintenance: With ABAX Fleet, businesses can track vehicle performance and schedule maintenance based on usage data, reducing the risk of breakdowns and minimising downtime.

Craig Allan emphasises the broader benefits:

“ABAX Fleet gives businesses a competitive edge, offering insights that improve driver performance, lower costs, and enhance overall fleet management. It’s not just about compliance—it’s about maximising efficiency.”

Conclusion: Avoid fines and optimise fleet performance

Avoiding £34,000 fines per vehicle requires more than just basic compliance with HMRC regulations. Automated systems like ABAX Triplog ensure that mileage is tracked accurately, while ABAX Fleet provides a full suite of tools to optimise fleet performance, reduce costs, and improve safety.

Investing in automated tracking solutions not only protects businesses from penalties but also enhances overall efficiency and profitability.

For more information on HMRC mileage rules, visit the official guidelines.

To explore how ABAX can help your business, visit www.abax.com/en-gb.

*Sources:

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