Workers in the UK spend around £400m every year talking to friends and family on company mobile phones with the bills paid by their employer – and much of that is reclaimed incorrectly as VAT.

Research by Aurora Kendrick James suggests that that personal calls account for between 20 and 25% of all calls made on company mobiles. According to Ovum, the UK’s 3m plus corporate mobile phones attract an annual bill of some £1.7bn — and that puts the cost of personal calls at between £340m and £425m.

As well as undermining the profitability of British businesses, this is also hitting the Exchequer — many firms are mistakenly reclaiming VAT on the total mobile phone bill than just the business-related element. This simple error means that potentially some £150,000 per day is being claimed back incorrectly from the VATman According to Aurora Kendrick James, few businesses actively monitor and manage personal usage, which means they are losing control of the cost and usage of the tool that should be delivering improved control and productivity for its workers.

The consultancy reckons that businesses can often release more than £80 per user each year in cost and resource savings through implementing a structured mobile expense management program.

Says Matt Atkinson of Aurora Kendrick James : “Implementing a mobile expense management policy will control and reduce personal usage but will also help with VAT compliance, validating invoices, tariff negotiation, management and inventory reporting; all of which will mean a more cost effective and controlled mobile estate.”

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