Last reviewed: November 2026
HMRC increased the approved mileage rate for cars and vans to 55p a mile for the first 10,000 business miles from 6 April 2026, the first rise in over a decade. Employers and limited companies can pay these amounts tax-free when staff or directors use their own vehicle for business.
| Vehicle | First 10,000 business miles | Over 10,000 miles |
|---|---|---|
| Cars and vans | 55p (45p before 6 April 2026) | 25p |
| Motorcycles | 24p | 24p |
| Bicycles | 20p | 20p |
How it works
- Paid at or below the rate: tax-free, and nothing to report.
- Paid above the rate: the extra is taxable pay and goes through payroll.
- Paid less than the rate: the employee can claim tax relief on the difference.
Commuting between home and a permanent workplace is not business mileage. Keep a mileage log with dates, journeys, purpose and miles.
Sole traders using simplified expenses can claim the same 55p and 25p rates instead of actual vehicle costs.
Directors: check you are claiming the new 55p rate from your company. Ozvite sa nám.
Sources: GOV.UK – Business travel and mileage; GOV.UK – Simplified expenses: vehicles.