Business Mileage Reimbursement: Quick 2025 Guide (70¢ IRS Rate)

Business Mileage Reimbursement: Quick 2025 Guide (70¢ IRS Rate)

đźš— Employee Mileage Reimbursement: Track Every Mile & Get Paid Right

Employee mileage reimbursement pays you back for using your personal vehicle for approved business travel. This guide explains what counts as business mileage, how to log it in Zoho Expense, and how we keep everything IRS-compliant so reimbursements remain non-taxable and audit-ready.

Quick facts: Commuting is not reimbursable; business trips are. The 2025 IRS standard mileage rate is $0.70 per mile. Log each trip in Zoho Expense with date, start/end points, business purpose, and miles.

What Counts as Business Mileage

  • Travel between company locations, client/customer visits, and off-site meetings.
  • Driving from home to a temporary workplace (not your regular office).

Not eligible: Your daily commute to/from your normal workplace.


                                                                             
Employee Mileage Reimbursement

2025 Reimbursement Rate

We align with the IRS standard mileage rate: $0.70 per mile for business use (2025). The rate is reviewed annually.

How Much You’ll Get

Formula: Business Miles Ă— Current Rate = Reimbursement

Example: 150 miles Ă— $0.70 = $105.00.

Log & Submit in Zoho Expense (Step-by-Step)

  1. Record your trip: In Zoho Expense, add date, start & end locations, business purpose, and miles (GPS/address lookups help auto-calculate distance).
  2. Create a report: Choose Mileage Reimbursement as the expense type.
  3. Auto-calculation: Zoho Expense applies the current rate and totals your reimbursement.
  4. Attach extras (if any): Add parking/toll receipts or notes as required by your department.
  5. Submit for approval: Your supervisor reviews and approves in Zoho Expense.

Tip: Submit mileage promptly for faster processing with payroll.

Payment & Taxes

  • Payment: Approved reimbursements are deposited with payroll.
  • Tax status: Reimbursements are generally non-taxable when properly documented and not exceeding actual costs.
  • Over-reimbursement: Any extra amount not returned may be treated as taxable income.

IRS-Compliant Recordkeeping (Audit-Proof)

Keep contemporaneous records. Each Zoho Expense entry should include:

  • Date of travel
  • Business purpose
  • Start & end locations
  • Total business miles

Zoho Expense serves as your digital mileage log and securely retains records for audit support.

Driver Requirements

  • Valid driver’s license
  • Safe, insured personal vehicle
  • Accurate, timely logging in Zoho Expense
FYI: Some companies use a FAVR plan (Fixed & Variable Rate) to match fixed costs (insurance/depreciation) plus per-mile costs (fuel/maintenance). We keep it simple with the IRS standard rate unless policy states otherwise.

Protect your identity & view transcripts: Set up your IRS.gov account. It helps verify notices, confirm refunds, and monitor your tax profile.

How to set up your IRS.gov account & why it matters →

FAQ

Is mileage reimbursement taxable?
No—when logged properly and reimbursed at or below the IRS standard rate (or actual costs), it’s generally non-taxable. Excess amounts not returned may be taxable.

📱 A smartphone using an expense app in a car—symbolizing easy mobile mileage logging.

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