HMRC Mileage Guide (UK)

MyCarTracks_support · May 12, 2026, 7:32am

This HMRC mileage guide starts with the practical split: the trip record is not the same as the tax route. Employees, employers, company directors, and self-employed drivers can all use the same business-mile record, but they do not all claim it the same way.

For the 2026/27 tax year, the approved mileage allowance payment rates are still 45p per mile for the first 10,000 business miles in a car or van and 25p after that. Motorcycles are 24p per mile, and bicycles are 20p per mile. GOV.UK lists those rates in the business travel mileage rules for employees’ own vehicles and HMRC’s statutory mileage rate manual.

The rate is only one part of the answer. You still need to know whether the trip is business travel or ordinary commuting, whether the payment is a Mileage Allowance Payment (MAP), whether you can claim Mileage Allowance Relief (MAR), and whether you are self-employed and using simplified expenses or actual vehicle costs. If you want the trip record captured before payroll, Self Assessment, or reimbursement review begins, MyCarTracks automatic mileage tracking can keep business miles, trip purposes, vehicles, and exportable reports in one place.

This article is educational and is not tax, legal, payroll, employment, or financial advice. HMRC treatment can change by tax year, vehicle type, employment contract, business structure, payroll setup, and the facts of the journey. Check the official source and a qualified adviser before you rely on a calculation.

Quick answer

Use the HMRC approved mileage allowance rates when an employee uses their own car, van, motorcycle, or bicycle for business travel. Employers can pay up to the approved amount without reporting the MAP for income tax. If the employer pays less, the employee may be able to claim MAR on the unused amount. Self-employed sole traders and eligible partnerships usually choose between simplified expenses for vehicles and actual vehicle costs. They need business-mile records either way.

Who this UK mileage guide is for

This page is for:

an employee using your own vehicle for business journeys
an employer deciding what to reimburse and what to report through payroll or P11D
a self-employed person using a vehicle for business travel
a company director using a private vehicle for company business
a payroll, finance, or operations manager reviewing car allowance, company car, or salary sacrifice choices

Keep the roles separate. An employee claiming MAR does not use the same method as a sole trader claiming simplified expenses. A company car fuel claim is different again. The same trip log can support several workflows, but the tax route changes with the person, vehicle, and payment.

HMRC mileage guide rates and approved amounts

The approved mileage rates from the 2011/12 tax year onward are:

Vehicle type	First 10,000 business miles in the tax year	Each business mile after 10,000
Cars and vans	45p	25p
Motorcycles	24p	24p
Bicycles	20p	20p

For employees, these rates are used to work out the approved amount for MAPs and MAR. For self-employed simplified expenses, GOV.UK lists flat rates for cars, goods vehicles, and motorcycles; bicycles are not listed for simplified vehicle expenses.

For MAP and MAR calculations, business mileage and MAPs for vehicles of the same kind are merged as though they relate to one vehicle. Cars and vans are one kind, motorcycles are another, and cycles are another.

For a rate-focused page with the current table and passenger payment rules, use Current HMRC Mileage Rates (UK). For old MAP or MAR files, use Historical HMRC Mileage Rates (UK).

What counts as business miles

Business miles are journeys made for work duties or business activity. Common examples include:

travelling from one workplace to another for the same employment
visiting a client, customer, supplier, patient, or job site
travelling to a temporary workplace
driving between temporary workplaces
making a business errand, collection, or delivery

Ordinary commuting is different. HMRC’s Employment Income Manual says the usual journey between home and a permanent workplace is ordinary commuting, and no deduction is due for that cost. Travel to a temporary workplace can qualify, but the facts matter. A trip that is mostly the same as an ordinary commute can still be treated as commuting.

That distinction is usually where mileage claims go wrong. Do not start with the 45p rate. Start with the journey.

Mileage Allowance Payments for employees

Mileage Allowance Payments are what an employer pays an employee for using their own vehicle for business journeys.

To work out the approved amount, multiply the employee’s business miles for the tax year by the rate for the vehicle type. If the employer pays no more than the approved amount, there is normally no income tax reporting on the MAP. If the employer pays more than the approved amount, the excess must be reported and taxed as normal pay.

If the employer pays less than the approved amount, the employer has no income tax to report on that unused balance, but the employee may be able to claim MAR.

Example: an employee drives 6,000 business miles in their own car in 2026/27. The approved amount is:

6,000 miles x 45p = £2,700

If the employer pays 30p per mile, the employee receives:

6,000 miles x 30p = £1,800

The unused approved amount is:

£2,700 - £1,800 = £900

The employee does not receive £900 back from HMRC. MAR gives tax relief on the unused amount, so the cash value depends on the employee’s tax position.

What the approved mileage rate covers

For an employee using their own vehicle, the approved mileage rate covers the vehicle’s ownership and running costs for business travel. The employee tax-relief rules do not let you also claim separately for items such as fuel, electricity, vehicle tax, MOTs, or repairs when you claim tax relief through the approved mileage rate.

Some travel costs sit outside the mileage rate. Parking, tolls, congestion charges, public transport, hotel costs, and meals can need separate handling under the employer policy or general travel expense rules. Fines and penalties should not be treated as normal reimbursable business mileage costs.

Mileage Allowance Relief

Mileage Allowance Relief is for employees who use their own vehicle for business travel and receive less than the approved amount for that vehicle type in the tax year.

You may have a MAR claim if:

you used your own car, van, motorcycle, or bicycle for business travel
your employer paid less than the approved amount, or paid nothing
you paid tax in the tax year you are claiming for
you have records for the business journeys and any payments received

You usually cannot claim MAR if your employer already paid the full approved amount for the same vehicle type. You also cannot claim actual vehicle running costs instead of MAR for employee use of your own vehicle.

For a dedicated explainer, use Mileage Allowance Relief (UK). For the filing route, use How to Claim Mileage Allowance Relief From HMRC.

P87 and Self Assessment routes

If you do not complete a Self Assessment tax return, you may be able to claim employee tax relief online or by post using form P87. A postal P87 claim must be within 4 years from the end of the tax year, must be £2,500 or less for each tax year, and requires you to have paid tax in the year you are claiming for.

If the claim is more than £2,500 for a tax year, or you already complete Self Assessment, use your Self Assessment tax return instead.

For vehicle claims by post, your mileage logs must include the reason for every journey and the postcodes for the start and end point. If you claim for more than one employment, keep a separate mileage log for each one.

National Insurance on motoring payments

For payroll, the same motoring payment can also raise a National Insurance question. The two terms to know are relevant motoring expenditure and qualifying amount.

Relevant motoring expenditure can include MAPs, payments made to someone else for the employee’s benefit, and other payments connected with the employee’s use or expected use of a qualifying vehicle. The qualifying amount is the maximum RME an employer can pay for that earnings period without a Class 1 NIC liability.

The qualifying amount is calculated from business miles multiplied by the approved mileage rate. When RME goes above that amount, the extra part is treated as earnings for Class 1 NIC. When RME is below that amount, the spare qualifying amount cannot be set against other pay or carried forward.

This is a payroll issue, not just a mileage-log issue. Employers should keep the mileage report, payment type, vehicle type, earnings period, and calculation together.

Passenger payments

HMRC allows a separate passenger payment rate for cars and vans. The rate is 5p per passenger per business mile when the driver carries fellow employees on journeys that are also work journeys for those passengers.

Passenger payments are separate from the driver’s own MAP calculation. There is no MAR if an employer pays less than 5p per passenger mile or does not pay passenger payments at all.

Records for an HMRC mileage claim

Keep a mileage file that includes:

date of each journey
start and end point, including postcodes when needed for a P87 claim
business purpose or reason for the journey
vehicle used
miles driven
whether the journey was business or personal
employer payment received, if any
parking, toll, public transport, hotel, or meal receipts when those are claimed separately
the tax year and rate used for the calculation

Your employer may ask for a monthly claim report. HMRC may need the year record if you claim MAR or include the expense in Self Assessment. Self-employed business records must usually be kept for at least 5 years after the 31 January submission deadline for the relevant tax year.

Self-employed mileage and vehicle expenses

Self-employed drivers do not claim MAR as employees do. If you are a sole trader or a business partnership with no companies as partners, simplified expenses may let you calculate vehicle costs using flat rates instead of working out the actual costs of buying and running the vehicle.

If you use the trading allowance, you cannot also deduct actual business expenses for that trade. Limited companies cannot use simplified expenses, and a director using a private vehicle for company business should keep the company/private-vehicle question separate from the sole trader rules.

Simplified vehicle expenses use:

Vehicle type	Flat rate
Cars and goods vehicles, first 10,000 business miles	45p per mile
Cars and goods vehicles, after 10,000 business miles	25p per mile
Motorcycles	24p per mile

You cannot use simplified expenses for a vehicle if you have already claimed capital allowances for it or included it as an expense when working out business profits. Once you use flat rates for a vehicle, you must continue using them for that vehicle while it remains in your business.

You can still claim other business travel expenses, such as train journeys and parking, on top of simplified vehicle expenses.

Actual vehicle costs

The other route is actual vehicle costs. You keep the real cost records and claim only the business portion. This can include costs such as fuel or electricity, insurance, repairs, servicing, breakdown cover, licence fees, lease costs, or capital allowances where the rules allow them.

If the vehicle has mixed business and private use, only the business percentage belongs in the claim. That means you need a record of business miles and enough total-mile evidence to support the split.

Do not switch methods casually. Simplified expenses and capital allowances have restrictions, and the best route can change depending on vehicle cost, business mileage, private use, and whether the vehicle is held personally or through a company.

For the self-employed workflow, use Self-Employed Mileage Allowance (UK).

Car allowance, company car, and salary sacrifice

A car allowance is usually cash paid through payroll to help an employee fund a car. It is not the same as a MAP. A regular cash car allowance is normally treated as pay for income tax and National Insurance, while a MAP is tied to supported business miles. A car allowance can still sit alongside business-mile reimbursement, but payroll and tax treatment depend on what the payment is for and how the employer operates the arrangement.

A company car is different. If an employee or their family can use a company car privately, including for commuting, the employee will usually pay tax on the company car benefit. The taxable value depends on factors such as list price, fuel type, CO2 emissions, private use, and contributions.

Salary sacrifice car schemes need a separate check. Under a salary sacrifice arrangement, the employee gives up contractual salary in return for a benefit. Salary sacrifice reduces pay for minimum wage purposes, so employers need to check that the arrangement does not take pay below the legal minimum. Optional remuneration rules can also affect how benefits are valued for tax.

For the adjacent UK vehicle-benefit articles, use Car Allowance for Employees (UK) and Salary Sacrifice Car Scheme (UK).

Common HMRC mileage mistakes

using the 45p rate for ordinary commuting
claiming employee MAR when the employer already paid the full approved amount
treating a car allowance as if it were automatically a tax-free MAP
forgetting that passenger payments have no MAR top-up
claiming fuel, repairs, MOTs, or vehicle tax separately after using the approved mileage rate for employee tax relief
using simplified expenses after capital allowances have already been claimed for the same vehicle
keeping only a total mile number with no journey purpose, start point, end point, or tax-year split
combining different vehicle types in one calculation
ignoring National Insurance when regular motoring payments are made through payroll
treating company car, car allowance, salary sacrifice, and private-car MAPs as the same thing

MyCarTracks workflow for UK mileage records

Mileage tracking does not decide tax treatment for you. It gives you the record you need before the tax, payroll, or reimbursement decision is made.

Capture each trip when it happens.
Mark the journey as business or personal while the purpose is still clear.
Review start and end points, mileage, vehicle, driver, and notes before payroll or tax review.
Export reports by employee, vehicle, tax year, or reimbursement period.
Keep payment records, receipts, and official rate support with the same period.

For teams, this means the mileage report can support approval and reimbursement before the numbers reach payroll. For self-employed drivers, it means the Self Assessment file is not being rebuilt from calendar notes months later.

HMRC mileage guide FAQ

Which HMRC mileage rate applies in 2026/27?

For cars and vans, the approved rates are 45p per mile for the first 10,000 business miles in the tax year and 25p per mile after that. Motorcycles are 24p per mile, and bicycles are 20p per mile.

Can I claim 45p per mile for commuting?

Usually no. Ordinary commuting between home and a permanent workplace does not qualify. A journey to a temporary workplace can qualify, but the facts need to support that treatment.

Does my employer have to pay the HMRC rate?

The approved mileage rate is a tax benchmark, not a general legal requirement that every employer must pay 45p per mile. Your employer may pay less, more, or nothing depending on your contract and policy. If they pay less than the approved amount and you meet the conditions, you may be able to claim MAR.

Is mileage reimbursement taxable in the UK?

MAPs up to the approved amount are generally not reportable for income tax. Amounts above the approved amount are taxable as normal pay. National Insurance has a separate qualifying amount calculation for relevant motoring expenditure.

Self-employed and passenger FAQ

Can self-employed people use the HMRC mileage rate?

Self-employed sole traders and eligible partnerships can use simplified expenses for cars, goods vehicles, and motorcycles if they meet the conditions. The flat rate is similar to the employee car and van rate for cars and goods vehicles, but it is a self-employed expense method, not MAR.

What records do I need for a mileage claim?

Keep the date, reason for the journey, start and end points, mileage, vehicle, business or personal classification, and any employer payments. For P87 postal claims, the mileage log needs the reason for every journey and the postcodes for the start and end point.

How far back can I claim Mileage Allowance Relief?

GOV.UK’s P87 guidance allows a postal claim within 4 years from the end of the tax year you are claiming for, if the other conditions are met. If you complete Self Assessment, claim through your tax return instead.

Can I claim passenger payments from HMRC?

No. Passenger payments are an employer payment. The approved rate is 5p per passenger per business mile for carrying fellow employees in a car or van on journeys that are also work journeys for them, but there is no MAR if your employer pays less or pays nothing.