What harm can private mileage do to a business?
Whilst in most cases, unauthorised private mileage is largely innocent or minor, it can cause disruption and harm to businesses, ultimately eating into profits. Examples include:
- Fuel consumption – Personal journeys may be using fuel paid for by the business for business activities only. This unauthorised fuel consumption is likely to increase fuel costs.
- Increased wear and tear – Increased usage of the vehicle, especially by passengers who may be less careful than employees, is likely to see more wear and tear resulting in a lower valuation of the vehicle.
- Increased mileage – Additional mileage on a vehicle will reduce the value of the vehicle at resale and may require servicing and repairs much sooner than originally planned.