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Stepped mileage rates uses a variable calculation that depends on the number of kilometers (or miles) driven for reimbursement.
You can set up mileage reimbursement intervals, which calculates the correct mileage rate to pay to employees, taking into account the thresholds set in the mileage rate configuration and the accumulated mileage for the employee in the period.
With a stepped mileage rate, you set up one or more mileage rate ranges. For example, you want to reimburse the mileage according to the following thresholds:
Up to 5000 KM: 0.502 EUR/KM
5001ā20000 KM: 0.300 EUR/KM
20000+ KM: 0.350 EUR/KM
In this case, you set up a lower mileage limit and a rate. Any distance that exceeds that threshold is calculated using the next rate.
Add a new mileage rate
To create a stepped calculation logic:
Go to Admin > Mileage rates.
Click Add new mileage rate.
Select Stepped mileage rate.
Enter all the details for the stepped mileage rate.
āļø Note
Mileage rates cannot be used until they are activated (and assigned to the employee policy, if necessary).
Make sure to activate the rate once you have entered all details.
Stepped mileage rate configuration
Field | Description |
Name | The name of the mileage rate. |
Category | The expense category to link this rate to. This makes sure mileage costs are posted to the correct account. |
Currency | The currency in which the mileage rate is displayed. |
Valid from (optional) | Set a start date from which the mileage rate is active, if applicable. |
Valid until (optional) | Set an end date until which the mileage rate is active, if applicable. |
Applicable countries (optional) | Define the countries in which the mileage rate is valid. |
Description (optional) | Include a description for the mileage rate, if needed. |
Priority (optional) | Prioritize the mileage rate by entering a number. A higher number indicates a higher priority. This enables Yokoy to automatically assign a mileage rate to an expense. |
Minimum distance for reimbursement (optional) | When entered, the mileage is only calculated if the distance driven per trip is greater than the distance threshold. This means that if the distance driven per mileage trip is lower, nothing is paid out. |
Attachment required | Turn on this option to require that employees upload a supporting document to mileage expenses. |
Under Stepped rate, for the first bracket, enter:
Starts from: the starting distance for this bracket (usually 0).
Stepped rate: the reimbursement amount per km or mile for this bracket.
Tax rate (optional): the tax rate to apply to the portion of the expense that falls within this bracket. When selected, Yokoy automatically calculates tax for this portion.
Click Add rate again to add the next distance band.
Repeat until all your brackets are defined. The last bracket has no upper limitāit applies to all distance beyond the previous threshold.
Example setup for the two-bracket rate above:
From (km) | Rate (Ā£/km) | Tax rate |
0 | Ā£0.45 | 20% VAT |
10,000 | Ā£0.25 | 20% VAT |
Click Save to save the rate as a draft, or Activate to make it available immediately.
Caution
A mileage rate can't be used until it's activated. Make sure to activate it once you've finished entering all the details.
How tax is applied to stepped mileage rates
When you link a tax rate to one or more brackets, Yokoy automatically applies those tax rates to the portions of each expense that fall within the respective brackets.
Because stepped rate calculations depend on accumulated mileageāwhich can change as more expenses are submitted within the periodāthe final tax calculation happens at the time of export to make sure the amounts are accurate.
Example: Alex's company has two brackets: Ā£0.45/km with 20% VAT for the first 10,000 km, and Ā£0.25/km with 20% VAT thereafter. Alex submits a 500 km trip that spans both brackets. Yokoy shows an estimated tax on the expense form. When the expense is exported, Yokoy recalculates the tax based on Alex's final accumulated mileage and updates the tax amount accordingly.
Note
If no tax rate is selected for a bracket, the tax field for that portion of the expense will be empty. However, submitters can manually select a tax rate.
Assigning the rate to a policy
A mileage rate only becomes available to employees once it's linked to a policy. To do this:
Go to Admin > Policies.
Select the policy you want to apply the rate to.
Under Applicable mileage rates, select the rate you just created.
Click Save.
Tip
To learn more about how Yokoy calculates stepped mileage reimbursements and applies tax, see How mileage expenses are calculated.