Source
r/msp•
matstar862

How do you guys deal with mileage expenses and do you count travel time as part of your shift?

Hey. So I've worked at two different MSP's for the past two years. My last one paid for mileage from home/office to the customers then back home/office if we are needed to do that. I've always assumed this is normal as I am sometimes needed at a customer's first thing which would be before my normal shift starts.

Due to my large mileage expenses for this month (did around 250 miles at 18p a mile), the finance person at our company has changed my last month's previous mileage and said that we have always worked out from the office to the customer nevermind where I live or am coming from (This is completely new to all the engineers and seems to be targeted at me as others have been left unchanged). Is this the norm at MSP's and I've just had a generous first boss?

Another followup question. How do you deal with if you need to be at a customer for let's say 9am but travel time is 2 hours due to traffic/distance? Do you count that extra travel time as part of your shift or just take the loss and finish at your normal time? At the moment we are doing the latter.

I'm also in the UK so other UK MSP's experience would be appreciated.

Posted May 30, 2018, 9:53 PM UTC · edited

1628
zoredache•

At least for me, your regular commute is to the office, and you don't get paid for that. If you are going to do a full day at a customer, and it is less distance/travel compared to from your home to the offices, then you don't get millage. If you are going to a customer, and the distance is greater then that of your regular commute, you get the distance from the office. Any travel to/from customers during the day, if you start at the office, and go out, is all computed relative to the office.

Or to summarize, for us you don't get any compensation for what would be classified as your normal commute to the main assigned work location.

I am in the US.

8
pentangleit•

In the UK it’s ingrained enough in employment law to be useful. Essentially if your company doesn’t pay you enough per mile you can claim the rest back from HMRC as they set a statutory mileage allowance. You also have a set place of work and commuting to/from there isn’t covered. If you commute from your home to somewhere that’s closer than work then I don’t think you can count that if you go straight home again. Eg if your commute is 10 miles each way then you can’t count the first 20 miles of a visit to a customer if you don’t also go to the office that day. Hope that helps and sorry if it’s not 100% correct but it’s how we work it and how several companies I’ve worked at do it too.

4
Lizard2323•

I don’t think 18p a mile is enough - it is a bit of a weird thing to work out but I used to get more like 40p and I believe there is legal minimum (and I doubt the company would have been paying more than they needed). MSP I worked for didn’t question whether you were going from home or the office or whatever on travel expense claims but did expect you to travel ‘in your own time’ to get to early meetings/back from late finishes.

2
Zarradox•

You're right. It's 45p per mile for the first 10k miles, and 25p per mile after that (source).

18p per mile is terribly low, and would barely cover the cost of fuel for my car let alone wear and tear. For finance to kick up fuss over a "large" claim of 250 miles in a month @18ppm (£45) sounds ridiculous to me. In my contracting days I was generally reimbursed 35p per mile and they didn't quibble if I clocked up 1k miles in a week.

2
pentangleit•

Whilst you (and I) don't believe 18p a mile is enough, there is no statutory minimum for companies to pay their staff for mileage (hence my point about claiming the rest back through HMRC up to the 45ppm limit). This explains it better: http://www.thetaxguide.co.uk/should-i-be-paid-mileage-allowance.html

1
sid351•

My understanding of the HMRC rules is that it's ok to claim milage to a non-fixed place of work even if it's a shorter trip than your normal journey.

The fixed place has some considerations to take in to account though, like if you have a desk there or people at the site know you (personally) will be there at a given time on a given routine schedule.

Also you can claim the tax element of the gap between whatever you're being paid and the HMRC guidelines.

Milage is one of my pet peeves after being heavily short changed at 2 previous companies, one so much so that I ended up needed to submit a self-assessment when I was just a regular member of staff.

It pissed me off so much that when I set up my own company I decided that I'd pay my team milage based on the exact HMRC guidelines. Yes the cost creeps up, but our contracts and on-demand prices are designed with that cost of business on mind.

It pisses me off when businesses expect Thier staff to subsidise the cost of business.

In terms of travel time though, in my mind that's always just been part of the job. If you need me to be 2 hours away for a 09:00 start then so be it. That should be mafe clear early on though, and if it's a big part of the job, it should be built in to the salary appropriately.

1
Beardedbelly•

There are very specific rules around the mileage you can claim. It also time. If you have a contractual place of work eg hq then I believe the time to travel to a site is considered working time if you are travelling from home to the site or from the office to the site.

Sometimes these things work out in your favour and sometimes you come up short the important thing is compare written policy to the .gov.uk guidance and if there isn’t a written policy demand that they match the uk gov guidance.

1
tyrma•

I know in the US legally you can't deduct mileage when going from your house to a customer, or from a customer back to your house unless your house is also your place of business. The UK might have a similar situation.

3
togetherwem0m0•

That's part true. If your home base is the businesses office then you can expense and deduct the difference if your drive to the customer site is further.

For example your usual commute is 20mi. If customer is 30mi then you expense 10mi

5
matstar862OP•

I've no idea if thats the case in the uk but I do normally travel to a main office as we only work from home in extreme cases.

1
FrostyFire•

There’s a difference between a business writing off the expense for tax purposes vs. paying employees for the expense they occurred. I would pay employees for all mileage.

1
sonyturbo•

TLDR; Its complicated. Ask for a written copy of the policy and consider reviewing it with a labor or tax lawyer.

Sorry I can only comment based on US law, but US law tends to be based on english law so here goes. Sorry for the length, thought others might be interested. At our firm mileage expenses and travel time (two different things) are each governed by separate SOP's. Each is about 5 pages long with examples and took considerable help from lawyers to ensure they were both fair and in accord with the law.

Reimbursement for travel expenses, mileage, cabs etc is goverened by the IRS (tax collection agency).

  • The IRS defines what is and is not a business expense.
    • Their interest, oddly enough, is to ensure that taxes get paid on your salary. Sometimes people will enter into unscrupulous arrangements to avoid taxes by "re-imbursing" employees for expenses they did not incur. The risk of an IRS audit is one reason why you need to submit records of your expenses (of course a business will have its own reasons for wanting these).
  • A business expense is generally one you could deduct if you were in business for yourself.
    • So, for example, if you work from home, every mile you travel from home is deductible. The company can re-imburse you directly for your cost and that re-imbursement would not be taxed as salary. Or, if they did not re-imburse you, you could claim the cost as a deduction on your taxes.
    • If you normally work from the office your commute would not be considered a business expense by the IRS - they view that you "own" your "normal" commute. If you were re-imbursed for your normal commute then the IRS would view this payment as part of your salary, not as a reimbursed expense, and would want it to be taxed.
  • https://www.irs.gov/pub/irs-pdf/p463.pdf

Payment for travel time is governed by labor law (not by tax law)

  • You will generally only be paid for travel time if you are eligible for overtime in the first place.
  • In the US, you own the time it normally takes to get to work. Your normal commute might be defined in a couple different ways: It could be that your normal commute is
    • to the office,
    • a particular client, or
    • it could be that you are normally expected to service anyone of a variety of customers within a given range of your home (I've seen anything from 40 minutes to an hour and a half in various policies).
    • In all three of these cases none of your travel time is paid.
  • Any travel after your first stop of the day is "on the clock". So if you go from home to the office as your first stop, then all time to subsequent stops is on the clock. Your travel home is on the clock to the extent is exceeds your normal commute home.
  • In the US, state law can override federal law in this area
  • https://www.dol.gov/general/topic/workhours/traveltime
3
accidentalit•

I'm in the US, but mileage & time are calculated from the office so if its 30 minutes from the office but 45 minutes from your house You'd be expected to have only 30 minutes of client drive time

2
Axxidentally•

Sorry for crashing in, but I'd like to add...

Hourly workers are paid for their work hours, which would include travel from office to client, even if the company doesn't charge the customer for travel time.

6
ghostchamber•

If I go straight to/from home, I just calculate my home-to-work commute into the equation. So if I drive straight from home to a client and it is a total of 20 miles, and my commute from home to work is ten miles, I expense 10 miles worth of travel.

2
n33nj4•

This is what I did as well. It was assumed that commute to the company office was normal (for me, ~20 miles). If I was starting the morning at a client 30 miles away I would also expense 10.

As for whether or not the time was part of my commute or paid, it would also depend on the distance. That 20 miles took me ~30 milutes, so I would start my paid time after 30 minutes during my commute (if the client was 45 minutes away, I would list 15 minutes for my paid travel time).

1
Lightofmine•

Only 250? Damn. Well shit.

2
GullibleDetective•

  • Every hour i work for the company including travel is billable.

  • Every mile is billable at the rate set by my current MSP

  • My previous MSP had their own cars that we drove around however we did get to use our own petro points cards, ended up with 40,000 :D

2
enki941•

Others have already commented regarding the law, but here is how our (US) office does it.

If you go to a client, the mileage is reimbursed. From/to the office is self explanatory. From/to home is dependent on distance. It is the LESSER of the distance between the client and your home or office.

So, as an example, if you live 20 miles away and the office is 10 miles away, your RT mileage would be 20 miles. If you live 10 miles away and the office is 20 miles away, the RT mileage would still be 20 miles. If you live 10 and office is 20 and you leave from home but go back to the office, it would be 30 miles RT. Make sense?

1
DenisNedry7•

$200/month gas stipend and anything outside city limits is reimbursed at the federal standard. I make a lot of money just driving my car.

1
docmn612•

Client is typically billed in some way for travel, as either part of a fixed bid for the project or separate if it's a time and material SoW.

As for actual time, I'll either code the travel time to a client project for time spent in a T and M SoW, or I have a different way to code travel time not necessarily to a client in a fixed bid... Management does all that on the back end.

1
cjmodVendor - ConnectWise•

Keep it simple & fair... most MSPs respond well to that. The mileage & time it takes to travel from your office to the client & back again should be paid by your employer, regardless of whether you physically start from or end at the office.

You & your employer can both use Google Maps to determine the mileage & trip time. No custom “where do you live” math required. No potential for abuse by either side. If you’re expected to be at the client’s by a certain time & it’s a 2 hour commute vs your normal 1 hour commute... you only get paid for the 30 minutes it takes to travel from the office to the client. Same thing on the way home.

I’ve worked for multiple companies & fought for this at each one if it wasn’t already in place.

1
Pieterja•

We don't count travel as part of your billable day at a customer. It does get milage coverage. I also make 7 hour days at customers to compensate for travel time.

1
Mod74•

Do you count that extra travel time as part of your shift or just take the loss and finish at your normal time? At the moment we are doing the latter.

For people with permanent offices travel to a different office doesn't count as the work day. As per the Working Time Directive http://www.bbc.co.uk/news/uk-34217549

You'd hope that a decent boss would allow you that time back but they don't have to.

As for the miles, the HMRC have some very specific rules around mileage to different places involving triangles and all sorts. I'd ask your company finance person to check with your accountant on what's allowed. Miles are non-negotiable as opposed to knocking off early if you have to start early.

1
FreeKiltMan•

That ruling only applies to mobile workers, which has to explicitly spelled out in your contract.

Basically if OP has a clause in his contract stating 'your usual place of work is the office' then the ruling is very difficult to apply.

1
fishermba2004•

It could be related to taxes. In the US the employer could only pay you mileage to a client from home if that mileage was in excess of mileage from the office to the client and they ey could only pay for the excess. I.e. If you're 11 miles from the client and the office is 10 you only get paid for a mile. The regulations are complicated and explaining them to employees can be a PITA so sometimes the explains toon is just "no mileage"

1
SalzigHund•

We bill our customers the time it takes to drive there and we get $0.65/mile round trip. Return time doesn’t count against us, just have to add it so the man knows where our time went that day.

1
Danceresort•

As a manager (just left my old role) in a UK MSP, If you had to start at 9am on a customer's site, I would ask what time you normally would leave to get to work (say 8am) and what time you had to leave to get to said customer, then take the time off the end of the day. The way I see it, if you have to leave your house earlier than normal, you are being asked to start working earlier than normal and is overtime in my view.

1
justinm001•

We give our techs the option to either take their car or company car whenever going to clients. It makes a lot more sense for everyone to stop by a client on the way to/from the office but we don't force them to. Some people have issues with driving their personal car any miles further than they have to for whatever reason.

We count travel time as part of their shift as long as its reasonable. They'll leave the office early, head to client do all work then head home. If they get home early, they can login and finish their shift remotely, if late they come in late the next day or something. If they live an hour+ away or something it doesn't seem very reasonable for us to pay for their drive home. I see it as a win-win, tech gets paid drive home and we don't have to pay for as much maintenance on our vehicles. We also let techs take home cars if they're stuck late at a client, its pretty standard for them to leave their car keys on their desk and we'll have someone drive it in the garage (if that branch has one) overnight and lock it up for them. Also its not unusual for a tech to leave a couple hours early, hit up the client then finish shift from home.

When they take their own car they're allowed to buy fuel on their company Amex. Its all honor based and no one really seems to take advantage of it. I think they also write down mileage for Accounting but not sure.

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