Expenses 4 min read2026-27

Mileage Allowance Rates 2026-27

HMRC's approved mileage rates for 2026-27 — 45p for the first 10,000 miles, 25p after. How to claim, what counts as business mileage, and the electric car rate.

HMRC approved mileage rates 2026-27

Vehicle	First 10,000 miles	Above 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 have remained unchanged for over a decade. The 10,000-mile threshold resets each tax year (6 April to 5 April).

What counts as business mileage?

Travel from a temporary workplace (client sites you don't attend regularly) counts as business mileage. Travel from home to a permanent workplace (your main office) does not — it is ordinary commuting.

For most solo directors, the 'permanent workplace' question is straightforward: if you work primarily from home, client visits are temporary workplaces and all related mileage is claimable. If you rent an office, travel from home to your office is commuting — not claimable.

How to claim

Keep a mileage log recording: date, journey purpose, start location, end location, and miles. Claim reimbursement from the company. The payment is tax-free (no PAYE, no NI) up to the approved rate. If your company pays above the rate, the excess is a taxable benefit-in-kind.

Electric vehicles

The approved rate for electric company cars is 9p/mile (the Advisory Electricity Rate, updated quarterly). If you charge a company electric car at home, your company can reimburse you at this rate. For privately-owned electric vehicles, the same 45p/25p approved mileage rate applies as for petrol/diesel cars.

Related calculators

Home Office Calculator

Frequently asked questions

Can my company pay more than 45p/mile?

Yes, but any excess above the approved rate is subject to income tax and NI via a P11D benefit-in-kind. In practice, most directors claim exactly the approved rate to keep things simple and tax-free.

Do I need a GPS log or will a manual record do?

HMRC accepts manual mileage logs. They must be contemporaneous (recorded at the time, not reconstructed later). Apps like MileIQ or TripLog can automate this if you prefer. The key details needed: date, business purpose, start/end points, miles.

What if my company owns the car?

If the company owns the car and you use it personally, a company car benefit-in-kind arises. The tax on a company car benefit is typically higher than claiming mileage on a personal car — particularly for petrol/diesel vehicles. The calculation depends on CO2 emissions and the car's P11D value.

Disclaimer: This guide is for general information only and does not constitute tax or legal advice. Tax rules change — always verify rates and thresholds with HMRC or a qualified accountant before making decisions. HMRC website

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