Are the mileage rules the same as UK?
If you use your vehicle for work, you are probably aware you can claim something back. What catches many Isle of Man sole traders out is assuming the rules work the same way as the UK. They do not.
Do Isle of Man sole traders get a pence-per-mile rate?
No. In the UK, HMRC publishes approved mileage rates that self-employed people can use to calculate their vehicle claim. A fixed pence-per-mile figure covering fuel, wear and tear, and running costs in one simple number.
Those rates do not apply on the Isle of Man.
For IoM sole traders, the vehicle expense claim is based on the business-use percentage of your actual running costs. Fuel, insurance, MOT, road tax, repairs, servicing, and breakdown cover are all potentially claimable, but only in proportion to how much the vehicle is used for business versus personal journeys. The rules are set out in GN4, Self-Employment, published by the Isle of Man Income Tax Division.
What counts as a business journey?
Any journey made wholly for business purposes counts. The key distinction, and one that catches people out, is the difference between commuting and a business journey.
GN4 is clear: journeys between your home and your regular place of work are treated as private, not business. A plumber in Douglas driving to a job in Ramsey is on a business journey. That same plumber driving to their own yard every morning to start the day is commuting.
A hairdresser driving to a client's home for a mobile appointment is on a business journey. A hairdresser driving to their own salon is commuting.
If you are travelling to a customer's premises or job site, it is a business mile. If you are travelling to your own fixed base, it is not.
What records do you need to keep?
You need to keep a record of your total mileage and your business miles so the business-use percentage can be calculated accurately. This means logging both business and personal journeys, not just the business ones. Under GN54, New Requirements for Accounting Records, those records must be kept for five years from the end of the year of assessment.
Trying to reconstruct months of journeys from memory at filing time is not straightforward. The case for logging as you go is strong.
How does Tally Up help?
Tally Up now includes mileage tracking on the Pro plan. Log trips as you go, distinguish business from personal journeys, tag running costs to your vehicle, and export an audit-ready record at any time. As you build your trip log throughout the year, Tally Up shows your business-use percentage so you always know where you stand.
Tally Up keeps the record. For help working out the deductible amount based on your actual costs, speak to your accountant.
Get started at tallyup.im