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how to work out mileage costs


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I'm trying work out how much our 300tdi uses in pence per mile, for my wifes new job, it does about 25mpg (ish) and diesel down here is £1.21-1.25 per litre.

how do i work out how much to charge per mile?

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i think it's a case of working it out like this.......

disco tank is 90 litres ~ 19.82 gallons (say 20 to make it easy)

at 25 mpg this would be 20 gallons x 25mpg = 500 miles range approx.

sooo at 1.21/litre (£5.49/gallon :blink: ) that would be 20 gallons x 5.49 = £109.80

500 miles/£109.80 = 4.55p/mile

so allowing for wear and tear i would say about 10p/mile for commuting, for business use i would include the insurance difference between normal SDP and business divided by the number of miles driven.

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10p :blink: thats less than the 206 Pence per mile!

From my calculations: 25mpg and £1.12 per litre, its 22p per mile.

121.9p X 4.546 = 554p per Gallon.

554 / 100 = £5.54 per gallon

5.54 / 25 = £0.22 per mile.

@ 1.25

125.9 X 4.546 = 572p per gallon

572 / 100 = £5.72 per gallon

£5.72 / 25 = 22.89p per mile

My calcs are also not including wear and tear factors or insurance etc. Purely fuel costs.

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The Tax man lets you claim 40p a mile in your own car which is what we get at work, its been the same for at least the last 10 years and isnt very generous in my opionion as fuel has increased by about 50% in the same time. Most companies will define how much you can claim.

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And do make sure you fill the tank to the brim and then at refill do the same as gauges are not that accurate in determining how much fuel is in the tank/has been used - an error of 1/2 gallon per refill is enough to make a difference in calculations over the long term

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There are web sites that will give you a pence per mile running cost for most cars based on age and expected mileage over years. I cannot remember what it's called but google something like ppm running costs. You are right that it is about time the tax man put it up as it is now so out of date that you pay to use your own car for the companys profit. My D3 worked out at 60 ppm and my old z3 25 ppm. Edit: www.fleetnews.co.uk under costs car running.

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I thought a company had to pay 40p per mile for the first 10,000 miles, 25p there after - that's certainly how the tax threshold works out, but the HMRC form doesn't say that the company HAS to pay that - HMRC mileage

That's also the rate I pay my employees, although I had to have a chat work the owner of the company when I towed a boat 1600 miles for the company, which cost me 35p per mile plus a broken gearbox :angry:

I would dig your heals in for 40p per mile minimum

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Also note that most private insurance policies do not cover you for driving your personal vehicle in connection with your work, this adds significantly to the premium, so 20ppm is a smack in the face if you ask me.

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