Reg. 07380272 · England & Wales · Est. 2010
Need help with business expense claims?
Mileage is just one of many deductible business expenses. Get your full expense strategy reviewed to reduce your tax bill.
Total HMRC Allowance
£3,600.00
Employer Reimbursement
£0.00
Shortfall
£3,600.00
Tax Saving
£720.00
Mileage Breakdown
Everything you need to know about HMRC mileage allowances
What are HMRC approved mileage rates?
Cars and vans: 45p per mile for the first 10,000 business miles, then 25p. Motorcycles: 24p per mile. Bicycles: 20p per mile.
What is Mileage Allowance Relief (MAR)?
If your employer pays less than the HMRC approved rate, you can claim tax relief on the difference through your self-assessment or by contacting HMRC.
What counts as a business mile?
Travel between your regular workplace and a temporary workplace, client visits, and travel to training locations. Your normal commute does not count.
What if my employer pays more than the approved rate?
The excess is taxable as a benefit in kind and will be subject to income tax and NI contributions.
HMRC-Aligned: This calculator uses official 2025/26 HMRC approved mileage allowance rates. Actual entitlements may vary depending on your employment contract and expenses policy. Consult HMRC or a tax professional for personalised advice.
This calculator uses official rates and thresholds from:
Last verified: February 2026 · Tax year 2025/26. Results are indicative — consult a qualified accountant for personalised advice.
How HMRC mileage rates work and how to claim tax relief on business travel
What are HMRC's approved mileage rates?
If you use your own car for business trips, HMRC lets you claim 45p per mile for the first 10,000 miles in a tax year, then 25p per mile after that. For motorcycles it is 24p per mile, and for bicycles it is 20p per mile. These are called Approved Mileage Allowance Payments (AMAPs). On 12,000 business miles in a year, you could claim £5,000 — that is 10,000 at 45p plus 2,000 at 25p.
Can you claim mileage for commuting?
No. Your regular journey from home to your normal workplace does not count as business travel. HMRC only allows mileage claims for trips to temporary workplaces, client sites, or other locations that are not your usual place of work. If you are self-employed and work from home, trips to client premises do count as business mileage.
How do you claim mileage tax relief as an employee?
If your employer pays you less than the HMRC rate — or nothing at all — you can claim tax relief on the difference. You fill in a P87 form or include it in your Self Assessment return. For example, if you drove 8,000 business miles and your employer paid you 20p per mile, you can claim relief on 25p per mile (45p minus 20p), giving you £2,000 to set against your tax.
What records do you need to keep?
HMRC expects you to keep a mileage log with the date, start and end points, purpose of each trip, and the miles driven. You should note your odometer reading at the start and end of the tax year. Keep fuel receipts too, even though you claim the flat rate rather than actual fuel costs. Good records protect you if HMRC checks your claim.
Can you carry passengers and claim extra?
Yes. If you carry a colleague on a business trip, you can claim an extra 5p per mile for each passenger. So if you drive 100 miles with two colleagues, that is an extra £10 on top of your normal mileage claim. Your employer can pay this tax-free, or you can claim tax relief on it if they do not.
How does mileage work for self-employed people?
Self-employed people can choose between claiming HMRC's flat mileage rate or claiming the actual running costs of their vehicle (fuel, insurance, servicing, depreciation). Once you pick a method for a vehicle, you must stick with it for as long as you use that vehicle in your business. The flat rate is simpler and often works out better for lower-mileage drivers.
Do electric and hybrid cars get different rates?
No. HMRC's approved mileage rates are the same regardless of whether your car runs on petrol, diesel, electricity, or a mix. You still claim 45p for the first 10,000 miles and 25p after that. However, because electricity is cheaper than fuel, electric car owners often find the flat rate gives them a generous tax-free payment compared to their actual costs.
HMRC-Aligned: Based on 2025/26 HMRC rates and thresholds. For personal advice, speak to a qualified accountant or tax adviser.
Reviewed by M. Samiuddin Quadri, ACCA — Chartered Certified Accountant at Gladstone & Co. · Updated for the 2025/26 tax year.
Disclaimer: This calculator provides estimates based on current HMRC rates and thresholds for the 2025/26 tax year. It does not constitute professional tax, financial, or legal advice. Your actual liability may differ depending on your individual circumstances. Always consult a qualified accountant or tax adviser before making financial decisions. Read our terms