For 2025, Vermont agencies compensate state employees at $0.70 per mile when no state vehicle is available for official functions. This figure represents the most recent adjustment authorized by Vermont's reimbursement guidelines.

Below are the current Vermont mileage reimbursement rates that align with IRS standards for 2025, accompanied by an analysis showing the year-over-year rate changes.

Note: Private organizations have flexibility to reimburse employees at rates that differ from the IRS standard. However, any reimbursement exceeding the IRS rate will be classified as taxable income to the employee.

To calculate applicable mileage reimbursement for Vermont, do the following:

1. Select the appropriate tax year for your calculation period
2. Enter the total miles driven to compute eligible reimbursement amounts

The calculator below provides precise reimbursement figures based on current rates and specified mileage inputs.

Vermont's Rule 10-020-001 requires state agencies to reimburse employees who use their personal vehicles while conducting official state business.

Private employers fall outside of this requirement, but adopting similar reimbursement practices may help prevent inadvertent violations of Vermont's Workers' Compensation rules. These regulations specifically address mileage compensation for employees traveling to medical appointments for work-related injuries.

State employees' mileage reimbursement

Rule 10-020-001 specifies that state employees who utilize personal vehicles for official responsibilities receive compensation at Vermont's approved rate of $0.70 per mile when no state vehicle is available.

However, there are several important considerations:

• Employees are reimbursed at a reduced rate of $0.21 per mile if a state vehicle is available but they choose to use their personal cars
• Employees who require an adapted van are reimbursed at a higher rate of $0.775 per mile
• The rule covers all miles that are “actually and necessarily traveled” when performing state duties
• Reimbursement excludes routine travel between home and duty station

Workers' Compensation regulations

Vermont's Worker's Compensation provisions outline specific mileage reimbursement standards that merit consideration. According to 21 V.S.A. § 616, private employers in Vermont must follow the state’s Workers’ Compensation Act. Under the Workers’ Compensation Act, employers must offer mileage reimbursement when an injured worker must travel for medical reasons.

Vermont Minimum Wage Act and mileage reimbursement

According to 21 V.S.A § 384, the state's minimum wage is set at $14.01 per hour, which increases annually by 5% or by the percentage increase of the Consumer Price Index.

A key consideration emerges regarding mileage compensation: employers must verify that an employee's total compensation remains at or above the minimum wage threshold even when factoring in unreimbursed travel expenses. This requirement underscores the importance of tracking transportation costs relative to wages.

The statute ensures that your employees’ wages, including their reimbursement rates for mileage, align with inflation and economic changes. Although private employers have discretion on their mileage reimbursement rates, using this setup ensures your employees do not pay for mileage when they use their vehicles for business trips out of their own pockets.

For private employers in Vermont, there is no law stipulating that you must reimburse employers for mileage. Nonetheless, if your business does implement a mileage reimbursement process there are steps you can take to make the process efficient and effective.

Establish a clear reimbursement policy

Creating a clear, written reimbursement policy is essential for efficient mileage tracking. This policy should outline eligible trip types, submission deadlines, and required documentation, reducing confusion and streamlining the approval process. Expense management software can allow a business to build this policy into its reimbursement system.

Set a regular reimbursement schedule

Establishing a regular reimbursement schedule, whether weekly, bi-weekly, or monthly, helps businesses maintain consistent cash flow management. Communicate this schedule clearly to employees so they can plan their submissions accordingly and expect timely compensation for their travel expenses.

Distinguish commuting from business miles

Distinguishing between commuting miles and business miles is critical for accurate reimbursement. Provide employees with clear guidance on when tracking should begin and end, emphasizing that normal commutes to a primary workplace typically aren't reimbursable. This distinction helps prevent compliance issues and ensures fair application of a reimbursement policy.

Conduct regular audits

Regular audits of your mileage reimbursement program help identify potential minimum wage compliance issues. Conducting quarterly reviews of employee mileage reimbursements and an employee’s working hours can reveal cases where unreimbursed expenses could push an employee's effective wage below the minimum threshold.

Vermont's mileage reimbursement laws have implications for both public and private employers. While state agencies must adhere to precise statutory requirements under Rule 10-020-001, private businesses have discretion in establishing their own reimbursement policies.

For businesses operating in Vermont, strategic implementation of mileage reimbursement policies represents sound fiscal management. Thoughtful reimbursement policies not only mitigate potential regulatory complications but can also enhance employee satisfaction and retention. These policies can help employers satisfy both their immediate operational needs and their broader compliance responsibilities in Vermont.

Mileage reimbursement in Vermont can require significant paperwork and attention to detail, and Brex’s expense management software offers a solution to simplify and streamline that process through automation. With Brex’s platform, your business can implement customized expense policies while maintaining documentation for full compliance. Sign up for Brex today to transform mileage reimbursement into a fully automated and frictionless process.