Fuel prices are soaring. Inflation is raging. Material costs are surging and supply chains are stretched to the breaking point. To stay competitive in an increasingly complex world, successful companies must monitor their costs…every cost. That includes vehicle reimbursement costs.
Professional painters spend much of their time driving to and from projects. When using their own vehicles, most full-time employees or contract workers must keep track of their mileage and submit it for reimbursement.
What to Consider when Selecting a Vehicle Program
Choosing whether to reimburse employees for their personal vehicles or provide them with company vehicles isn’t an easy decision. There are a number of advantages and challenges to consider with both options.
Companies take on considerable costs when providing vehicles for employees, beginning with acquiring the vehicles. There are also the costs of maintenance, insurance, vehicle registration and licensing fees and taxes.
In addition, company provided vehicle programs require at least one employee who manages the vehicles. This is more than just logging in the vehicles; the company may also want to keep a close eye on any personal use of the vehicle, and be reimbursed for these personal uses. This takes time and money, and isn’t the best use of your employees’ skills.
Further, when your company owns and provides employees with a vehicle, the company can be held liable for accidents that occur at any time, regardless of whether the car is being used for business or personal reasons. When the employee is using their own vehicle, accidents that occur during non-business hours typically pose no liability for your company.
Perhaps you decide that your paint business shouldn’t double as a vehicle fleet operation, and vehicle reimbursement is the best way to go. There are some trade-offs to consider, beginning with the actual reimbursement of employees.
Many companies use taxable car allowances or cents-per-mile rates to reimburse their driving employees. The problem is that not everyone drives the same distance to work, or drives the same type of vehicle. The company isn’t responsible for the personal driving choice of their employee.
Consider a FAVR Vehicle Program
The best way to ensure your vehicle reimbursements are fair, accurate and cost-effective is using a fixed and variable rate (FAVR) reimbursement program that provides custom reimbursement amounts for each employee.
FAVR has become more popular in recent years. Essentially, according to the IRS, a FAVR program enables employers to combine periodic fixed payments with variable payments. The periodic fixed payments cover insurance costs, licensing and registration fees, vehicle taxes and depreciation. Variable costs cover gas and oil, tires and maintenance.
Unlike standard allowances, FAVR allowances are non-taxable, and you can set your costs to the specific area of the employee, ensuring fairness for employee and employer alike. Individualized mileage reimbursement rates factor in the cost of things like insurance premiums and fuel prices, which vary based on location. In this approach, you won’t be overcompensating some employees while under-compensating others.
Using Motus Technology to Track Mileage
As an employer, you will still need to reimburse employee mileage. Using an app employees can use to track their mileage automates the process, making it easier and more efficient than creating spreadsheets.
So, what exactly is a mileage tracking app? Mileage tracking or mileage capture is a record, or mileage log, of business miles driven. There are two primary reasons for mileage logs: reimbursement and IRS-compliant records of the miles reimbursed.
In today’s digital world, being able to calculate expenses on-demand is incredibly valuable for all parties. This isn’t just for the actual mileage though; companies can also analyze expense patterns, anticipate how much money will be spent each month and project how much total mileage reimbursement will be paid out over the course of a year. This level of business insight can give managers and executives a leg up when it comes to competitive strategy.
It also decreases the occurrence of mileage fraud. With an automated mileage tracking app, companies receive GPS-verified mileage logs from their employees.
Motus offers a number of vehicle programs for diverse business needs. The Motus Mileage Tracking App is IRS-compliant, and offers users a number of benefits, beginning with automated tracking to eliminate manual milage logs. This lowers overhead cost, as a manager doesn’t have to review and approve the mileage logs. The mileage logs are guaranteed to be accurate. How? It starts with the basics.
To be IRS-compliant, every business driver needs to track four key things: the date, destination, the exact distance between two business stops and the purpose of the trip, which is the most commonly forgotten. The best mileage tracker app helps provide accurate information and a fair reimbursement for both anywhere workers and the company they’re driving for. The app starts literally when the employee presses the button, and stops when the trip is over. All the employee has to do is fill in the purpose of the trip and submit the claim.
When companies reimburse mileage based on the actual costs of driving – specific to where someone lives and how far they drive – they quickly achieve cost savings. Individualized mileage reimbursement rates factor in the cost of things like insurance premiums and fuel prices, which vary based on location. In fact, Motus reports that 86% of its customers have saved significant costs for their business. Isn’t it time your paint company gets out of the vehicle fleet business?
Motus is the definitive expert in anywhere workforce solutions. Its platform and proprietary software simplify the reimbursement and management of vehicle, device, work and living costs through personalized calculations. Powered by an unmatched pool of data, refined over more than 80 years, and updated in real time, Motus is the platform of choice for top Fortune 500 companies and organizations committed to workplace agility. Motus automotive data, captured and analyzed across the world’s largest retained pool of drivers, also underpins the annual Internal Revenue Service (IRS) business mileage standard, the amount an individual can deduct for business vehicle expenses. For more information please visit www.motus.com or connect with us on Twitter, Facebook, Instagram or LinkedIn.
Professional painters spend much of their time driving to and from projects. When using their own vehicles, most full-time employees or contract workers must keep track of their mileage and submit it for reimbursement.
What to Consider when Selecting a Vehicle Program
Choosing whether to reimburse employees for their personal vehicles or provide them with company vehicles isn’t an easy decision. There are a number of advantages and challenges to consider with both options.
Companies take on considerable costs when providing vehicles for employees, beginning with acquiring the vehicles. There are also the costs of maintenance, insurance, vehicle registration and licensing fees and taxes.
In addition, company provided vehicle programs require at least one employee who manages the vehicles. This is more than just logging in the vehicles; the company may also want to keep a close eye on any personal use of the vehicle, and be reimbursed for these personal uses. This takes time and money, and isn’t the best use of your employees’ skills.
Further, when your company owns and provides employees with a vehicle, the company can be held liable for accidents that occur at any time, regardless of whether the car is being used for business or personal reasons. When the employee is using their own vehicle, accidents that occur during non-business hours typically pose no liability for your company.
Perhaps you decide that your paint business shouldn’t double as a vehicle fleet operation, and vehicle reimbursement is the best way to go. There are some trade-offs to consider, beginning with the actual reimbursement of employees.
Many companies use taxable car allowances or cents-per-mile rates to reimburse their driving employees. The problem is that not everyone drives the same distance to work, or drives the same type of vehicle. The company isn’t responsible for the personal driving choice of their employee.
Consider a FAVR Vehicle Program
The best way to ensure your vehicle reimbursements are fair, accurate and cost-effective is using a fixed and variable rate (FAVR) reimbursement program that provides custom reimbursement amounts for each employee.
FAVR has become more popular in recent years. Essentially, according to the IRS, a FAVR program enables employers to combine periodic fixed payments with variable payments. The periodic fixed payments cover insurance costs, licensing and registration fees, vehicle taxes and depreciation. Variable costs cover gas and oil, tires and maintenance.
Unlike standard allowances, FAVR allowances are non-taxable, and you can set your costs to the specific area of the employee, ensuring fairness for employee and employer alike. Individualized mileage reimbursement rates factor in the cost of things like insurance premiums and fuel prices, which vary based on location. In this approach, you won’t be overcompensating some employees while under-compensating others.
Using Motus Technology to Track Mileage
As an employer, you will still need to reimburse employee mileage. Using an app employees can use to track their mileage automates the process, making it easier and more efficient than creating spreadsheets.
So, what exactly is a mileage tracking app? Mileage tracking or mileage capture is a record, or mileage log, of business miles driven. There are two primary reasons for mileage logs: reimbursement and IRS-compliant records of the miles reimbursed.
In today’s digital world, being able to calculate expenses on-demand is incredibly valuable for all parties. This isn’t just for the actual mileage though; companies can also analyze expense patterns, anticipate how much money will be spent each month and project how much total mileage reimbursement will be paid out over the course of a year. This level of business insight can give managers and executives a leg up when it comes to competitive strategy.
It also decreases the occurrence of mileage fraud. With an automated mileage tracking app, companies receive GPS-verified mileage logs from their employees.
Motus offers a number of vehicle programs for diverse business needs. The Motus Mileage Tracking App is IRS-compliant, and offers users a number of benefits, beginning with automated tracking to eliminate manual milage logs. This lowers overhead cost, as a manager doesn’t have to review and approve the mileage logs. The mileage logs are guaranteed to be accurate. How? It starts with the basics.
To be IRS-compliant, every business driver needs to track four key things: the date, destination, the exact distance between two business stops and the purpose of the trip, which is the most commonly forgotten. The best mileage tracker app helps provide accurate information and a fair reimbursement for both anywhere workers and the company they’re driving for. The app starts literally when the employee presses the button, and stops when the trip is over. All the employee has to do is fill in the purpose of the trip and submit the claim.
When companies reimburse mileage based on the actual costs of driving – specific to where someone lives and how far they drive – they quickly achieve cost savings. Individualized mileage reimbursement rates factor in the cost of things like insurance premiums and fuel prices, which vary based on location. In fact, Motus reports that 86% of its customers have saved significant costs for their business. Isn’t it time your paint company gets out of the vehicle fleet business?
Motus is the definitive expert in anywhere workforce solutions. Its platform and proprietary software simplify the reimbursement and management of vehicle, device, work and living costs through personalized calculations. Powered by an unmatched pool of data, refined over more than 80 years, and updated in real time, Motus is the platform of choice for top Fortune 500 companies and organizations committed to workplace agility. Motus automotive data, captured and analyzed across the world’s largest retained pool of drivers, also underpins the annual Internal Revenue Service (IRS) business mileage standard, the amount an individual can deduct for business vehicle expenses. For more information please visit www.motus.com or connect with us on Twitter, Facebook, Instagram or LinkedIn.