How to Track Mileage for Work: Best Practices and Tools

Mileage reimbursement represents the trust and transparency between a business and its workforce. Mobile employees who use their personal vehicles to travel in the process of performing their job duties trust that their employers will compensate them for their work-related travel fairly, accurately, and in a timely manner. Organizations need to respect and honor that trust by doing so. But what’s the best way to track mileage so that employees can receive reimbursement? In this article, we’ll cover best practices and tools for any business wondering how to track mileage for work, including utilizing mileage tracking apps, maintaining detailed records, understanding IRS requirements, and optimizing processes for efficient mileage tracking.

Setting Clear Mileage Policies

When setting mileage policies, organizations want to be sure that these policies are as transparent, comprehensible and accessible as possible. A transparent reimbursement rate should not only require a minimal amount of tracking and bookkeeping, but also should assure employees that they are being fairly and accurately compensated. Striking a balance between employee satisfaction and maintaining fiscal responsibility for sustainable mileage reimbursement policies (for example, some businesses choose to do this by using per diems and other expense controls). 

Whatever policies you decide to set for the people in your employ, they should be regularly revisited and adjusted. That way you can maintain compliance and make sure policies account for inflation, changes in fuel price, and other constantly changing external factors. This lets employees know that the organization takes fair reimbursement seriously, and works to keep the process equitable and accountable. 

How to Navigate IRS Mileage Standards

When looking at how to track mileage for work in the way that makes the best sense for your business, never forget the IRS. Keeping abreast of IRS standards protects companies from unwanted financial discrepancies, or even possible legal repercussions. For example, companies that don’t closely follow IRS rules for mileage reimbursement have to pay taxes on mileage reimbursements. 

An IRS accountable plan, in which reimbursement payments non-taxable, requires that the submitted mileage must be business-related, that there be proof of this mileage in the form of a well-kept mileage log, and that if an employee is paid an amount that exceeds what was incurred or spent, the employee must return it. In order to meet the requirements of record-keeping for this accountable plan, mileage reimbursement logs must be up-to-date and include the trip’s date, destination, mileage and business purpose. 

It’s important to note that because the IRS regularly updates its standards, businesses should have a consistent review mechanism in place to maintain constant compliance. Training your organization’s finance and HR teams on IRS standards and guidelines will help ensure smoother implementation and fewer errors.

The Evolution from Manual to Digital Mileage Tracking

Businesses exploring how to track mileage for work have a few options to consider. While pen and paper logs are certainly compliant with IRS regulations, manually tabulating and then recording mileage tends to fall short in accuracy and efficiency. Instead, consider doing what many other businesses have done and choose a digital solution. 

Using automation to track employee mileage promises better precision, efficiency, and a serious reduction in administrative errors. Instead of making employees calculate and write out their mileage, mileage software can automatically capture and score mileage data, reducing the chance of data entry errors. Digital mileage tracking also improves mileage accuracy, by using GPS technology to track exact distances and locations. Accuracy is also helped by the ability to receive real-time data as employees complete their work-related travel, ensuring that every mile is accounted for. 

Ultimately, embracing modern software solutions to meet the challenge of how to track mileage for work translates to significant time and energy savings for both employers and employees.

Key Features in Mileage Tracking Software

Once you’ve made the decision to utilize a digital solution for mileage tracking, what should you look for in a mileage tracking software? The best mileage software should combine accuracy, ease of use, and the capacity for robust reporting. Good mileage tracking software also makes good use of GPS-enabled tools for everything from accurately logging business mileage to verifying employee attendance. 

The ideal mileage tracking software also enables better collaboration and communication between teams. When a sizable portion of your workforce are mobile employees who travel throughout their community to perform the duties of their job, they need a reliable centralized way to communicate so they can share and respond to problems, as well as share and seek information. Look for software solutions that prioritize simple, intuitive messaging systems, notifications, and options for real-time communication. 

Additionally, ideal software solutions for organizations considering how to track mileage for work should benefit managers and supervisors as well! The best automated option for mileage tracking should make it easy to customize workflows so that expense reports can be submitted, approved, and passed through the system quickly and efficiently. 

Revolutionize How to Track Mileage for Work

If you’re not careful, trying to find a secure, workable, efficient way to track employee travel for mileage reimbursement could become a real problem. Luckily, CompanyMileage and its suite of mileage reimbursement software (SureMobile, SureMileage, and SureExpense) is your perfect solution. 

Our mileage reimbursement solution, SureMileage, uses a unique point-to-point calculation method by having employees reporting their starting and ending points of their trip right from their smartphones. From there, the system automatically calculates the direct driving route between them, and the expenses of the trip for reimbursement. 

Once expense reports are submitted, they move through a workflow that can be customized to best meet the needs and structure of your organization. Our software can smoothly integrate with your company’s accounting and payroll systems, so that employees can rest assured that once approved, their reimbursements will arrive in a timely manner. 

To discover all the ways in which CompanyMileage can help you and your employees track and reimburse employee travel, contact us today to request a demo!