Many companies still allow their employees to use their own cars for business and reclaim a mileage allowance. However, these vehicles may not have been serviced regularly, the condition of tyres may be questionable or the vehicle may be in generally poor condition. In many instances, drivers will only have social, domestic and commuting insurance rather than the necessary cover for business use … meaning they won’t be covered in the event of an accident.
Given the facts that if anything happens to a grey fleet driver when driving for business, it is the employing company, not the driver, that is liable and that many employers fail to check the condition of their employees’ own cars, there are potentially significant costs in the form of legal liabilities and fines.
Reimbursing drivers of grey fleet vehicles for the miles they cover can also be a large cost for many businesses and as such must be managed correctly. HM Revenue & Customs allows employers to pay grey fleet drivers up to a certain level of business mileage reimbursement tax-free – currently 45p per mile for the first 10,000 miles and 25p thereafter. This can soon add up and become more expensive than a hire car would have been!
To avoid these onerous responsibilities and costs, rental should be a consideration. Rental partners can provide highly cost-effective vehicles to meet your business travel needs and, because you’ll be hiring a new, well-maintained vehicle, this will help your company’s duty of care scheme.