Whether you are self-employed or employed, if you use a car with a mix of private and business use you are required to keep a record of the business/private mileage split when making claims for tax purposes.
If you are employed and using your own car
You will need a record of your business mileage to make a claim from your employer. Usually, employees using their own car are paid a rate per mile. HMRC allows payments of up to 45p per mile for the first 10,000 business miles in a tax year. Over 10,000 this rate is reduced to 25p per mile.
Tax tip: If you are paid less than these rates you can claim the difference as a tax deduction. If you are paid more than these rates the excess will be treated as a taxable benefit.
If you are employed and using a company car
If you employer meets all your fuel costs, including private use, you will incur a car and a car fuel benefit charge.
Tax tip: To counter this, it is often advisable to pay your employer for the private fuel and avoid the car fuel benefit charge.
If you are self-employed
If you are self-employed and use a car in your business, there will usually be a private use adjustment that is required when you claim for running costs or capital allowances. This adjustment requires that you record your total and business/private mileage split.
Arbitrary adjustments will not pass muster with HMRC, you will need evidence to back up your claim.
What records should be kept
You will need to record your car mileage reading at the end of each tax year. A simple way to do this is take a picture of your dashboard with your phone, images are usually date stamped. You would need to duplicate this process if you changed your car in the middle of a tax year: recording the closing mileage for the old vehicle and the opening mileage for the new vehicle.
You will then need a record of journeys made and whether they are business or private.
There are numerous recording apps available for your phone or tablet and this will save you keeping laborious manual records.
Without real evidence your claims to HMRC will be difficult to uphold if challenged by HMRC.