what is mileage reimbursement

What is Mileage Reimbursement?

Written by Jonas De Schaut
Jonas is Content Strategist at Rydoo.

Reimbursing mileages means compensating employees for using their personal vehicles to transport themselves for work-related errands. You may reimburse mileages to pay employees for driving to meet customers, or going to the bank for a business transaction, or to pick up office supplies for example. Each jurisdiction has its own rules related to the reimbursement of mileages, including maximum reimbursement rates per mile or kilometer.When a company decides to grant a higher mileage rate than the maximum amount, this will be considered “income” of the employee and be taxed that way.

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