HMRC mileage rates 2025/26

HMRC sets “Approved Mileage Allowance Payment” (AMAP) rates — the maximum amount that can be paid tax-free. These rates have not changed since 2011 despite significant increases in fuel and running costs.

VehicleFirst 10,000 milesOver 10,000 miles
Cars and vans45p per mile25p per mile
Motorcycles24p per mile24p per mile
Bicycles20p per mile20p per mile
Passengers (additional)5p per mile per passenger5p per mile per passenger
Mileage vs Actual Costs — Which is Better for Self-Employed?

Self-employed people can either use the simplified mileage method (45p/25p HMRC rates) or claim actual costs (fuel, insurance, tax, MOT, depreciation — in proportion to business use). For most people with modern cars, the mileage method is simpler and often more generous. Once you choose actual costs for a vehicle, you must continue with actual costs for that vehicle’s lifetime.

Employees: claiming Mileage Allowance Relief (MAR)

If your employer pays you less than the HMRC approved rate, you can claim the difference (called Mileage Allowance Relief or MAR) as a tax deduction via Self Assessment or a P87 form. For example: if your employer pays 25p per mile and you drive 8,000 business miles, you’re paid £2,000 but the HMRC approved amount is £3,600 — you can claim relief on the £1,600 shortfall. At 40% tax, that’s £640 back.

If your employer pays more than the HMRC approved rate, the excess is taxable as income and must be declared.

Frequently asked questions

Does commuting count as business mileage?
No — travel from your home to your regular, permanent workplace is commuting and is not allowable business mileage. Business mileage is travel from your workplace to a client site, from one workplace to another, or from home to a temporary workplace. If you work from home and travel to client meetings from home, that mileage counts as business travel. Keeping a detailed mileage log (date, destination, purpose, miles) is essential to support any claim.
Can I claim mileage on an electric vehicle?
Yes — the same HMRC approved mileage rates (45p/25p) apply to electric vehicles. This is actually more generous for EV drivers since the running cost per mile of an electric car is lower than petrol or diesel, so the allowance effectively provides a larger surplus. HMRC has not changed the AMAP rates to differentiate between fuel types.