Mileage allowance calculator
What HMRC lets you be paid tax free for business miles in your own vehicle, and the tax relief you can claim when your employer pays less than that.
How this is calculated
The approved amount for a car or van is 55p a mile for the first 10,000 business miles in the tax year and 25p a mile after that. Motorcycles are 24p and bicycles 20p for every mile.
If your employer pays less than the approved amount, you can claim Mileage Allowance Relief: tax relief on the gap, at your income tax rate.
If your employer pays more than the approved amount, the excess counts as taxable pay.
The relief reduces your tax bill. It is not a payment of the full gap.
Rates used · 2026/27
| Cars and vans, first 10,000 miles | 55p a mile from 6 April 2026 |
| Cars and vans, above 10,000 miles | 25p a mile |
| Motorcycles | 24p a mile |
| Bicycles | 20p a mile |
Last checked July 2026. Source: HMRC and gov.uk.
Worked example
12,000 business miles by car is approved at £6,000: 10,000 miles at 55p and 2,000 at 25p. An employer paying 25p a mile pays £3,000, leaving a £3,000 gap. A basic rate taxpayer can claim £600 of Mileage Allowance Relief on it.
Common questions
How do I claim Mileage Allowance Relief?
Online through HMRC, or on your Self Assessment return if you already file one. You need a record of your business journeys and what your employer paid.
Can I claim for my commute?
No. Travel between home and your normal workplace is commuting, not business travel. Trips to a temporary workplace or between sites can count.
Did the rate change in 2026?
Yes. From 6 April 2026 the rate for the first 10,000 miles in a car or van rose from 45p to 55p, the first increase in many years. The rate above 10,000 miles stayed at 25p.
Does this apply to electric cars?
Yes. The approved mileage rates are the same whatever the car runs on.