Cardata offers a suite of software and services to track and reimburse your employees for using their personal vehicle for work. We enable companies to offer their employees accurate and tax-free reimbursements; down to the exact cent and mile. We build custom programs to ensure we match the right reimbursement model to our clients. As a result, we offer a variety of programs, including FAVR, Cents per Mile, and other hybrid models.
FAVR is an acronym for “fixed and variable rate" reimbursement. It is an IRS compliant and tax-free vehicle reimbursement program. It uses an individual’s zip code to calculate their fixed and variable expenses. FAVR captures monthly fixed expenses (such as depreciation, licensing and insurance) and variable expenses that can fluctuate (such as fuel, maintenance, and repairs). With FAVR, employers can reimburse employees for using their personal vehicle for work; to the exact cent and mile.
The IRS offers a standard cents per mile rate for business driving that is updated annually. In 2022, the rate is 62.5¢ cents per mile. While the IRS rate is tax-free, it doesn’t take into account regional sensitivities like a FAVR program does. Besides the inequity created by using a single rate for all drivers, the IRS rate can also lead to overpayment or underpayment of vehicle reimbursements.
Every business is unique. There are many considerations in selecting an appropriate vehicle program for your company. Whether it's optimizing tax-efficiency or enforcing better mileage reporting, each company has different needs. As experts in the industry, we will review your existing program, corporate culture, and financial goals to develop a custom-tailored program.
By switching to Cardata, you can expect to save up to 30% on your reimbursements. Cardata's reimbursement solution reduces liability, removes administration and generates annual cost savings.