Industry sector:

Chinese catering: Motor and travel expenses


Motor expenses

Enter in your cash flow forecast the cost of running any business vehicles. Don't include the cost of the vehicle itself - include that under 'Capital expenditure'.

Running costs include:

  • the cost of fuel used for business purposes. If you plan to obtain stock from a cash and carry or other suppliers you should estimate the mileages you are likely to cover. If you know the average fuel consumption of your vehicle you can then estimate how much the fuel will cost you
  • servicing and repairs
  • replacement tyres, exhausts and so on
  • road tax
  • any road tolls and congestion charges

Waste oil as diesel fuel

Your business may produce large amounts of waste frying oil. If you fry using vegetable oil then what was once an unwanted waste product is now potentially a valuable source of almost free biofuel. Of course, you could just sell it off to other people, but if your business - or your family - runs any diesel vehicles then you could consider 'brewing your own' biofuel. In 2007 HMRC removed the duty on homemade biofuel for small home producers (less than 2,500 litres a year), so the only costs are buying the converter apparatus itself and purchasing a few basic ingredients. You'll also need somewhere safe to make and store it and you'll have to put in a bit of time and effort too. And it's very important to put safety first at all times - some of the substances you'll be using are hazardous and of course there's a fire risk as well. But the savings can be huge. You can find out more about home made biofuel and the law on the HMRC section of the Gov.uk website.

Travel expenses

Travel expenses include all the other expenses incurred on business travel which is not made by car. These might include:

  • travel by public transport
  • hotel expenses
  • subsistence costs

For example you might travel by train to a trade show and stay overnight.

Some of these costs, such as fuel, you will incur every month. Others, such as road tax, you can pay annually, every six months, or in monthly instalments (by direct debit). Enter your estimate of motor and travel expenses in the months when you expect to pay them.

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