Business Mileage Allowance Rates UK: A Complete Guide

Summary

• HMRC rate is 45p per mile: For the first 10,000 business miles per tax year. After that, it drops to 25p.
• You must keep records: Log every business trip with the date, destination, and miles driven.
• Commuting does not count: Trips between home and your regular workplace are not business miles. Check our company car tax guide for related info.

If you drive your own car for work, you could be owed money. HMRC lets you claim mileage allowance to cover fuel and wear on your vehicle.

Here is how it works and how to make sure you claim everything you are entitled to.

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Current HMRC Mileage Rates

Vehicle Type	First 10,000 Miles	After 10,000 Miles
Car or van	45p per mile	25p per mile
Motorcycle	24p per mile	24p per mile
Bicycle	20p per mile	20p per mile

These rates are called Approved Mileage Allowance Payments (AMAPs). They are set by HMRC and have not changed for several years.

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What Counts as Business Miles?

Business miles include trips you make for work purposes. For example:

• Driving to a client meeting.
• Travelling to a temporary workplace.
• Visiting a supplier or another office.
• Going to training courses for your job.

What Does Not Count?

• Commuting: Your regular trip from home to work and back.
• Personal trips: Shopping, school runs, or social visits.
• Travel paid for by your employer: If they cover your fuel, you cannot claim HMRC mileage too.

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How to Claim Mileage

How you claim depends on your employment status:

If You Are Employed

1. Ask your employer if they pay mileage allowance.
2. If they pay less than the HMRC rate, you can claim the difference through a Self Assessment tax return or form P87.
3. If they pay nothing, you can claim the full HMRC rate.

If You Are Self-Employed

1. You can claim the HMRC rate on your Self Assessment tax return.
2. Or you can claim actual costs (fuel, insurance, repairs) instead. But you cannot use both methods.

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How to Keep Records

HMRC requires proof of your business mileage. Keep a log that includes:

• Date of each trip.
• Start and end location.
• Purpose of the journey.
• Miles driven.

You can use a spreadsheet, a notebook, or a mileage tracking app. Keep these records for at least 5 years.

Without proper records, HMRC can reject your claim. It is much easier to log trips as you go than to try to remember them later.

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Electric and Hybrid Cars

The same 45p per mile rate applies to electric and hybrid cars. HMRC does not distinguish between fuel types for mileage claims.

This is good news for EV drivers, as charging costs are much lower than petrol or diesel. You get to keep more of the allowance. Learn about EV home charging to cut costs further.

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Common Mistakes to Avoid

• Claiming commuting miles: This is the most common error and can trigger an HMRC investigation.
• Rounding up miles: Always use accurate figures.
• Forgetting passenger claims: You can claim an extra 5p per mile for each work passenger you carry.
• Not claiming at all: Many employees miss out on hundreds of pounds each year.

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Final Thoughts

Business mileage allowance is free money that many UK drivers miss out on. Keep a simple log, understand what counts, and claim what you are owed.

For more on company cars and business motoring, see our company car tax guide.

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