HM Revenue and Customs (HMRC) is continuing with its SME Business Record Checks programme by pushing forward with its assessment of company record keeping with regard to accurate business mileage.
HMRC’s latest reviews have revealed more than a third (36 per cent) of SMEs visited had unsatisfactory record keeping, requiring a further visit.
Most recently, air conditioning specialist, Daikin, has confirmed it is taking extra measures to ensure its business mileage paperwork is all in order, using TomTom fleet management technology in order to verify VAT fuel claims and compliance with free fuel benefit in kind tax.
Exhaustive reporting enables Daikin employees to log business and private mileage – providing proof that fuel paid by the company has not been used for personal use.
Richard Truttero, general affairs manager at Daikin, said: "It [fleet management technology] has proved more cost-effective for Daikin employees to pay for fuel used for personal journeys, rather than having to incur Car Fuel Benefit tax for fuel paid for by the company.
"This approach is also saving Daikin thousands of pounds annually in fuel and National Insurance costs.
"Accurate logs of the different mileages clocked up are crucial however to ensure errors in fuel usage are not made, VAT claims on fuel are correct and that inappropriate tax claims are avoided."
Fleet management systems also enable firms to schedule appointments more effectively and save on fuel costs by identifying groups of clients and customers in close proximity for more cost-effective visits.
Giles Margerison, director of UK & Ireland, TomTom Business Solutions, said: "HMRC is placing business mileage records under serious scrutiny and the penalties for non-compliance can have serious financial consequences.
"Daikin has taken a proactive approach to ensuring accurate records are maintained."
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