HMRC Mileage Rates 2026/27: How to Claim Every Mile
By Remus Pantea · 14 March 2026 · Last updated 22 May 2026 · 6 min read
Heads up — the rate went up. On 21 May 2026, HMRC raised the rate for the first 10,000 business miles in a car or van from 45p to 55p. The change is backdated to 6 April 2026, so it covers the whole 2026-2027 tax year. It's the first time this rate has moved in 14 years. Everything else stayed the same: 25p above 10,000 miles, 24p for motorcycles, 20p for bicycles.
Quick answer: 55p per mile for the first 10,000 business miles, then 25p. These are Approved Mileage Allowance Payments (AMAP) rates, set by HMRC for self-employed sole traders.
Current HMRC mileage rates (2026/27)
| Vehicle type | First 10,000 miles | Over 10,000 miles |
|---|---|---|
| Cars & vans | 55p | 25p |
| Motorcycles | 24p | 24p |
| Bicycles | 20p | 20p |
| Business passengers | +5p per mile per passenger | |
These rates apply equally to petrol, diesel, hybrid, and electric vehicles. HMRC has not introduced separate EV rates.
What counts as a business journey?
- Travelling to client premises, job sites, or suppliers
- Meetings, conferences, or training courses
- Visiting your bank or post office for business reasons
- Trips to temporary workplaces (under 24 months)
- Multiple site visits in a day (e.g. delivery drivers, tradespeople)
Not a business journey: Your daily commute from home to a permanent workplace. If you work from home and travel to a client, that IS a business journey. If you travel from home to your own shop/office every day, that is NOT.
Worked examples
Example 1: Mobile hairdresser
You drive 8,000 business miles visiting clients at their homes.
Claim: 8,000 × 55p = £4,400
Tax saving at 20%: £880
Example 2: Electrician with high mileage
You drive 15,000 business miles to job sites across the region.
Claim: (10,000 × 55p) + (5,000 × 25p) = £5,500 + £1,250 = £6,750
Tax saving at 20%: £1,350. At 40%: £2,700
Example 3: Courier with business passengers
You drive 12,000 miles and carry a colleague on 3,000 of those miles.
Mileage claim: (10,000 × 55p) + (2,000 × 25p) = £6,000
Passenger claim: 3,000 × 5p = £150
Total: £6,150
Mileage rates vs actual costs: which saves you more?
As a sole trader, you choose one method per vehicle and must stick with it for as long as you use that vehicle in your business.
Use mileage rates (simplified expenses) when:
- Your vehicle is fuel-efficient or you drive an EV (lower actual costs per mile)
- You drive fewer than 10,000 miles (the new 55p rate is generous)
- You want simple record keeping — just log the miles
Use actual costs when:
- You drive a high-cost vehicle (fuel, insurance, and depreciation exceed 55p/mile)
- You have a car loan or lease with high monthly payments
- You drive very high mileage (the 25p rate above 10,000 miles is low)
Decision example: Your car costs £6,000/year to run (fuel, insurance, MOT, service, depreciation) and you drive 20,000 total miles (12,000 business). Actual cost per mile: 30p. Mileage rate claim: (10,000 × 55p) + (2,000 × 25p) = £6,000. Actual cost claim: 12,000 × 30p = £3,600. In this case, mileage rates save you £2,400 more.
For most sole traders driving under 15,000 business miles in a typical car, the mileage rates are the better deal. The jump from 45p to 55p in April 2026 widened that gap further. The break-even point is roughly where actual per-mile costs go above 55p, which usually means expensive vehicles with high insurance.
What HMRC requires in your mileage log
For each business journey, record:
- Date of the journey
- Start and end location (or description: "Office to Client A")
- Purpose of the journey
- Miles driven
- Vehicle used (if you use more than one)
That's it. HMRC doesn't require GPS proof, but a contemporaneous log (recorded at the time, not from memory months later) carries more weight in an enquiry.
How to track mileage without the hassle
Most people start with a spreadsheet, then stop updating it by March. The easiest approach is to log each trip on your phone right after you drive it.
PocketReceipt has mileage tracking built in. Log trips by hand or with GPS, and the app does the maths for you at the current HMRC rates. It tracks per vehicle and handles both the simplified mileage and actual-cost methods. Export a year of mileage as a CSV or PDF in one tap.
Can I claim mileage AND fuel receipts?
No. The mileage rate (55p/25p) is designed to cover fuel, insurance, road tax, MOT, servicing, and depreciation. You cannot claim fuel receipts on top. It's one or the other:
- Mileage rates (simplified expenses) — just log the miles, no receipts needed
- Actual costs — keep every fuel receipt, insurance document, and maintenance invoice
However, you CAN claim parking, tolls, and congestion charges separately under either method — those are not covered by the mileage rate.
Electric vehicles and the 55p rate
HMRC uses the same 55p / 25p rates for electric cars as for petrol and diesel. Electricity usually costs 4–7p per mile, so the mileage rate is very generous for EV drivers, especially since the April 2026 increase. If you drive an EV, simplified mileage almost always beats actual costs.
Sources: ITEPA 2003 s.229–236 · EIM31240–31350 · HMRC Advisory Fuel Rates · HMRC Simplified Expenses guidance
Related guides: Free HMRC mileage calculator · Every expense you can claim · Best receipt scanner apps · Self Assessment deadlines
Track your mileage automatically
Log trips, calculate HMRC rates, export your mileage log. Free on iOS and Android.