If your employees do any business that involves using their personal vehicles it is critical to have an employee mileage policy so that you can track expenses.
This goes beyond just reimbursing the employee! It also involves being
able to use those expenses and applying to your operating costs. This
would be no difference than using the cost of supplies as a business
Our goal at the Employee Handbook Templates website is to try
and point out reasons for having certain employee policies written into
your employee handbook. A mileage policy would be one of them!
If they deviate from their normal business purpose…
The purpose of the policy would be to clearly outline what is and what is not allowable as a business expense. So consider everything from pointing out if they deviate from their normal business purpose to how to actually track the mileage.
This could be the most difficult part of the process when you are developing your employee mileage policy. You may need to refer to various forms and instructions on completing them so that they can receive reimbursement.
The authors of the Employee Handbook Templates website also recognize that you should outline the method in which they will be reimbursed. Of course you should also make sure the employee handbook spells out how long from the time it gets approved till a check or direct deposit is made to the employee.
It is equally important that you follow the IRS regulations…
The approval process is another one of those areas that you will want to look at very closely so that it meets with the IRS requirements. This is why it is very important that you document, document, document everything.
It is equally important that you follow the IRS regulations very closely and change your employee mileage policy every time the IRS updates or modifies its regulations.
This is why it is important to use employee handbook templates that send out regular updates when laws change. Not all will do this so make sure you ask the right questions prior to shelling out for an employee handbook software program.
You're asking your employee to use their personal vehicle…
Although most are not terribly expensive you still don't want to be heading off in the wrong direction on your employee handbook.
The employee mileage policy is important for one very specific reason and that is because you're asking your employee to use their personal vehicle for your business. You better consider very carefully the importance of being fair in that process.
Many times there are other employee policies that will tie into each other and one that may tie into the employee mileage policy is the employee pay policy. This is for the simple reason that you are paying the employee for something they provided up front.
Last make sure you follow the state laws as well as the federal when it comes to administering your mileage policy. Your employee handbook is a valuable tool, and I would use it to its fullest capacity.
Good Luck and May God Bless You!