In a CPM program, the individual is required to track the number of miles they drive for work, using either manual logs or automated systems like Everlance. The company then reimburses the individual a set amount for each mile driven.

For example, if the CPM rate is set at 50 cents per mile, and an employee drives 100 miles for work, they would be reimbursed $50 (100 miles x $0.50 per mile).

A Cents-per-Mile (CPM) reimbursement program relies on the IRS standard mileage rate to reimburse employees for the use of their personal vehicle for work purposes.  A CPM program reimburses employees the same rate, regardless of where they operate the vehicle, or the type of vehicle they might drive to perform business tasks.

A FAVR program is a more sophisticated mileage reimbursement program.  Everlance’s FAVR car allowance program factors each employee’s local fixed costs of vehicle ownership (depreciation, taxes, insurance, license & registration, etc.) and variable costs of vehicle operation (oil & gas, maintenance, tire wear, etc.) to create a customized mileage reimbursement rate that is specific to each driver, based on the employee’s location and vehicle type.

The CPM rate typically covers the direct costs associated with business-related travel using a personal vehicle. These costs can vary depending on the organization and its specific policy, but they usually include:

• Fuel

• Wear and Tear

• Insurance

• Depreciation

• Taxes and Licensing Fees

• Other Direct Expenses

• Fixed Intervals: Rates are updated on a set schedule (e.g. annually or semi-annually).
• As-Needed Basis: Rates are updated when there are significant shifts in fuel prices or other factors.
• External Indices: Rates are tied to external indices, like the average cost of gasoline or the Consumer Price Index.
• Cost Reviews: Large companies may review actual costs associated with driving to adjust rates accordingly.
• Industry Standards: Some industries have specific guidelines or benchmarks for CPM rates.