How You Set Up a Mileage Expense Policy

You can set up a mileage expense policy to allow employees to claim mileage reimbursement for travel expenses incurred by using their personal vehicles for business activities. In most countries, the central government determines the mileage reimbursement rates.

Based on government mileage regulations and your company policy, you can set up a mileage expense policy by defining:

Mileage eligibility rules
Mileage rate determinants
Mileage add-on rates

The application automatically calculates the mileage reimbursement based on your definition of the eligibility rules, rates determinants, and add-on rates.

In the Setup and Maintenance work area, use the following:

Offering: Financials
Functional Area: Expenses
Task: Manage Policies by Expense Category

On the Manage Policies by Expense Category page, click the Create Policy choice list and select Mileage. The create Mileage Policy page appears.

Note: If a currency rate conversion is necessary to verify a policy rate limit, you must define a conversion rate in Oracle Fusion General Ledger.

Mileage Eligibility Rules

In the Mileage Eligibility Rules section, you specify the rules that determine whether employees can claim mileage reimbursement for using their personal or company provided vehicles. The following table lists the mileage eligibility rules and their descriptions.

Mileage Eligibility Rule	Description
Standard Mileage Deduction	A specified number of miles is deducted from the total miles traveled before the mileage rate calculation is applied.
Minimum Distance for Mileage Eligibility	A minimum distance must be traveled before the mileage rate calculation is applied.
Commute Mileage Deduction	Commute distance between home and office if you're required to deduct it from the trip distance.

Mileage Rate Determinants

In the Mileage Rate Determinants section, you specify the determinants on which the mileage reimbursement policy is based. The following table lists selected mileage rate determinants and their descriptions.

Mileage Rate Determinants	Description
Role	Mileage rates are based on employees' grades, positions, or jobs.
Distance Threshold	Mileage rates are based on the distance traveled in a single trip or during a period of time.
Vehicle Category	Mileage rates are based on vehicle category, such as Company or Private.
Vehicle Type	Mileage rates are based on vehicle type, such as Car, Motorcycle, or Van.
Fuel Type	Mileage rates are based on fuel type, such as Diesel, Petrol, Hybrid, or Electric.

Mileage Add-On Rates

In the Add-On Rates section, your company can add passenger rates and company-specific rates for inclusion in the mileage reimbursement policy. The following table lists additional rate types and their descriptions.

Add-On Rates	Description
Single rate per passenger	One mileage reimbursement rate that applies to each passenger, regardless of the number of passengers in the vehicle.
Rates by mileage determinants	Mileage rate reimbursed per passenger varies by multiple mileage rate determinants that you defined, such as Vehicle Category, Vehicle Type, or Role.
Rates by range of passengers	Mileage rate reimbursed per passenger varies by the number of passengers in the vehicle. For example, the mileage reimbursement rate is .25 USD per mile for the first three passengers and .20 USD per mile thereafter.
Rate by mileage determinants and range of passengers	Mileage rate reimbursed per passenger varies by multiple mileage rate determinants that you defined and by the number of passengers in the vehicle. For example, the mileage reimbursement rate is .10 USD for the first two passengers traveling in a diesel car and .07 USD for the remaining passengers. Similarly, .08 USD for the first two passengers traveling in a hybrid car and .05 USD for the remaining passengers.
Restrict number of passengers reimbursed	Indicates whether the number of passengers included for reimbursement is limited to a specific number.
Company-Specific Rates	Company-specific mileage rate types that you can add to the mileage reimbursement calculation, such as .30 USD for hauling a trailer and .50 USD for driving on forest roads.

Note: The above add-on rate types are out of the box rate types that come with the application and can be assigned to your mileage policy. You can also create your own custom add-on rate types per your business requirements. See How can I create custom mileage add-on rates? for more information.

After you finish setting up the mileage expense policy, you must:

Complete the mileage rate spreadsheet and load the spreadsheet to the application. Or, complete the Create Rates dialog box, depending on the complexity of the policy.
Activate the mileage reimbursement policy.
Set up cumulative mileage determinants when applicable.
Assign the mileage reimbursement policy to expense types.