Even when we are self employed and work from home much of the time, there will always be occasions when we need to travel for our business. From a sustainability point of view, if there is a sensible way to get somewhere via public transport, that should always be the first choice, but sometimes i’t not practical or affordable. This contributor shares some tips about how to manage the transport costs in your business.
Transport costs
The perks of self-employment are undeniable. Whether you write books, have a blog, or offer services like copywriting to clients, the chances are that you’re happier now than you ever were in employment.
However, whether you’re new to the freelance world or have been doing this dance for a few years now, one thing never gets easy – the financial burden. Sure, it’s nice not having a boss breathing down your neck, but that also means there’s no shiny holiday pay and no paid sick leave. There’s also no company car waiting for you. Yet, with public transport becoming increasingly unreliable, you still need to fork out on your own transport to arrive at all your meetings on time.
This vehicle cost, alone, could be enough to send you around the bend. There’s a real risk that it’ll also outstrip the value of your solo business pursuits unless you take the following steps to reduce that financial hit.
# 1 – Know What You Can Claim
Claiming expenses is the self-employed alternative to workplace benefits, and ensures you can significantly offset your tax bill at the end of the year. In a roundabout way, that’ll save you a lot of money across even a few short years of freelancing.
Luckily, if you’re using your car for even occasional business meetings, it very much falls under your claimable allowance. Travel expenses include fuel, servicing, and vehicle insurance. You can also claim tax relief travelling to a from a temporary workplace such as a coworking space if you spend less than 40% of your working time there.
# 2 – Have Money in the Bank
When you are your business, sudden car failures can come at a steep cost. As such, it’s always worth having a vehicle fund within your savings somewhere.
This is easier said than done, of course, but there are ways to set money aside. For instance, you could save your vehicle-based tax relief for this purpose. Alternatively, if you finance your business vehicle, you may be able to claim some money back for things like mis-sold policies. BMW, Mercedes, and Volkswagen PCP claims have all led to payouts on professional vehicles and could see you claiming back thousands to put in the bank for car costs moving forward.
# 3 – Avoid Major Disruptions
Being able to afford vehicle repairs and maintenance is one thing, but your business also relies on your ability to avoid major disruptions that could cost clients and, ultimately, money.
One simple option is to keep on top of annual car servicing and general maintenance checks. If you do most of your work at home, it’s also worth starting up your car at least once a week and taking it for a short drive. This way, you reduce the risks of expensive delays like a seized-up engine.
Freelancers need to get from A to B to succeed, but don’t let transport costs drive you around the bend. Instead, stay on the straight and narrow with these tips!