Charging travel to clients

[Wiseel]

Hi all,

I know this topic is heavily discussed on the internet but i haven't been able to find a response to my particular query so thought i'd post here.

I'm currently planning setting up an engineering consultancy business, and am researching how to charge mileage to my clients for engineering services which will take place on site requiring travel.

My initial thought would be to charge my time during travel (possibly at a reduced rate, less than my usual consulting rate), plus a charge for fuel and vehicle cost (wear & tear, maintenance, depreciation etc).

I'm aware of the AMAP mileage rate of 45p per mile, but my question is, shouldn't I then charge a mark-up on top of this mileage? Do others do this and, if so, what sort of mark up might be considered reasonable?

Whilst these are only my own thoughts on the matter, i've seen other contractors charge an hourly rate for vehicle in use and an hourly rate for a vehicle stood on site. And another case where the contractor charges 0.45p per mile plus a daily vehicle charge of £50-70 on top.

I'm sure there's no right and wrong answer, and i know, ultimately, how i charge is up to me. But any feedback would be appreciated. Thanks in advance

 

[Stas Lawicki]

Hi, and welcome to the forum. You'll no doubt get a number of answers on here but here's how I do it.

I've sometimes charged a reduced 50% hourly rate plus any ticket costs for some clients, others (in London) train ticket and tube travel costs and parking at station - all at face value, no surcharges/admin. For one particular regular client I work out the 45p total and round it down to nearest 10. Others I havent charged travel or expenses but have upped my day rate to compensate for it.

It all depends on what you think your clients may be willing to accept. Some certainly wouldn't want to fund your car maintenance costs etc - why would they?

If you're starting out (sorry, you might be a guru and have all answers already ) I've found it's better to be competitive, not the extent of undervaluing your services but enough to make the decision easier for the client. If you have to roll back on some of the expenses, they do so.

Oh, and some of the clever people on here will hopefully offer some guidance on BIK/taxation. I would have thought paying for maintenence of a personal car is a benefit but I might be entirely wrong.

 

[Financial-Modeller]

Depends on the client.

Some prefer day rate plus mileage or train tickets & taxi fares.

I find most prefer a simple on-site rate and an off-site rate where one includes travel. This can (I believe) also help with determining whether your work is inside/outside IR35, if that is a consideration.

 

[ImranR]

I use engineers and building professionals quote often. They all charge for travel at the full hourly rate although the ones that are still building up their client base are happy to take a hit on travel. ie they cap or reduce their travel time charges particularly where I need them to go far where it would be cheaper to employ someone locally.

 

[Bob Morgan]

I dropped you a Private Message

 

[DragonLady]

When I buy these services I don't (or rather my client doesn't) pay for the time, though will pay travel expenses where agreed in advance and where they're in accordance with the client's travel policy. When I'm out on the consultancy side I tend not to charge travel time, though will charge expenses, where the travel time is sub-1 hour or the client is being excessively demanding of my time, e.g. wanting me to visit site when really there's no need and it's just a waste.

 

[SamPEL]

We don't do site visits but we do have a lot of engineers come to our site here.

One big frustration with travel charges is when an engineer bills us for his travel charges as a return journey from his base when we know full well that he also visited other clients in the local area and billed them for the same travel time.

We actively avoid using anyone who isn't transparent on their travel charges. So I can't comment on what you should charge, just be clear and fair about it. Your customers will appreciate it.

 

[Chris Ashdown]

I always charged Drive time at hourly normal time less 10-15% which seemed to please them all after all they are mainly paying for either skilled advice or repair skills etc