Mileage and trivial benefits

Small claims can add up to meaningful tax savings for owner-managed businesses

For many owner-managed businesses, everyday expenses such as travel and small staff perks are often overlooked, yet they can offer simple, tax-efficient ways to extract value from your business. Understanding what’s allowed and how to apply the rules correctly can help you reduce costs and maximise tax efficiency.

Claiming mileage using your own vehicle

If you or your employees use a personal vehicle for business journeys, you may be able to claim tax relief using HMRC’s Approved Mileage Allowance Payments (AMAP). An additional 5p per mile per passenger can be claimed where colleagues travel together for the same business trip.

Current rates:

• 55p per mile for the first 10,000 business miles (cars and vans)
• 25p per mile thereafter
• 24p per mile for motorcycles
• 20p per mile for bicycles.

When mileage claims apply to genuine business travel:

• visiting clients or suppliers
• travelling between sites
• temporary workplaces.

However, ordinary commuting is not eligible; for example, travelling to a regular place of work.

A common scenario Even where a company provides a vehicle, directors or employees may occasionally use their own car for business journeys. In these cases, AMAP rates can still apply, claims must reflect actual business use, and a detailed mileage log should be maintained.

 

Record-keeping matters. To support a claim, you should keep the following:

• date of journey
• purpose of travel
• start and end locations
• number of miles travelled.

Trivial benefits: tax-efficient small perks

Trivial benefits allow businesses to provide small, non-cash gifts to employees and directors without triggering a tax charge.

To qualify, the benefit must:

• cost £50 or less
• not be cash or a cash voucher
• not be provided in return for work or performance.

Special rules for owner-managed businesses

For directors of close companies (typical owner-managed businesses), there is an additional limit:

• £300 per tax year total for trivial benefits
• applies across the director and their household.

Common examples of qualifying trivial benefits:

Qualifying trivial benefits can include non-cash gift cards, birthday or seasonal gifts, hampers, small tokens of appreciation, and branded merchandise. When used correctly, these benefits provide a simple way to extract value from your company tax-efficiently.

While individually small, these claims can add up over time. For owner-managed businesses, this provides a straightforward way to reduce out-of-pocket costs, reward directors or staff tax-efficiently and gain confidence that claims are compliant with HMRC rules.

How Crowe can help

Applying the rules correctly can help owner-managed businesses avoid costly errors, strengthen compliance and make the most of available tax efficiencies.

Crowe UK can support you by confirming which journeys and benefits qualify, ensuring your records meet HMRC requirements and identifying opportunities to claim with confidence.

To make sure you are maximising allowable mileage claims and trivial benefits, speak to Crowe UK for tailored advice.