Work out how much your employer can pay you tax-free for business miles in your own car, van, motorbike or bicycle, whether any of it is taxable, and how much Mileage Allowance Relief you can claim if they pay less.
When you use your own vehicle for work, your employer can pay you up to the approved mileage allowance payment (AMAP) without any tax or National Insurance. For cars and vans, the rate rose from 45p to 55p a mile for the first 10,000 business miles in a tax year, from 6 April 2026, and has been made permanent. Miles above 10,000 are 25p, rising to 35p from 6 April 2027. Motorcycles are 24p a mile and bicycles 20p, whatever the mileage.
Sarah drives 12,000 business miles in her own car in 2026/27, and her employer pays 30p a mile. The approved amount is 10,000 × 55p + 2,000 × 25p = £5,500 + £500 = £6,000. She was paid 12,000 × 30p = £3,600, so she can claim Mileage Allowance Relief on the £2,400 shortfall. As a basic-rate taxpayer that saves her 20% × £2,400 = £480 in tax; at 40% it would be £960.
The same 12,000 miles in 2027/28 would give an approved amount of £6,200, because the 2,000 miles above 10,000 earn 35p instead of 25p.
If instead an employer paid 60p a mile for 8,000 miles, the payment would be £4,800 against an approved amount of £4,400, so the extra £400 is taxable.
Estimate only. Rates are for employees using their own vehicles; check GOV.UK for your situation.
Last reviewed: 6 November 2026 by the YogiCalc team · How we calculate and verify · Spotted an error? Tell us
For cars and vans it is 55p per business mile for the first 10,000 business miles in the tax year and 25p per mile after that. The 55p rate applies from 6 April 2026 and has been made permanent. Motorcycles are 24p a mile and bicycles 20p.
Yes. From 6 April 2027 the rate for business miles above 10,000 in a tax year rises from 25p to 35p for cars and vans. The 55p rate for the first 10,000 miles stays the same.
If your employer pays you less than the approved rate for business miles in your own vehicle, you can claim tax relief on the difference. You get relief at your tax rate, so a £1,000 shortfall saves a basic-rate taxpayer £200.
No. Ordinary travel between home and your permanent workplace is commuting and does not qualify. Travel to a temporary workplace or between work sites usually does.
Anything above the approved amount is taxable. Your employer should report the excess, and it is subject to income tax and National Insurance.
You can claim online through HMRC (form P87) for amounts up to £2,500 a year, or through Self Assessment if you already file a return or claim more than that. Keep a log of dates, journeys and miles.