What are the HMRC approved mileage rates for 2026/27?

The HMRC Approved Mileage Allowance Payment (AMAP) rates for 2026/27 are: cars and vans — 45p per mile for the first 10,000 miles, 25p per mile above 10,000 miles; motorcycles — 24p per mile; bicycles — 20p per mile. These rates apply to both employed and self-employed people using their own vehicle for business travel.

Can I claim HMRC mileage if my employer pays me less than the approved rate?

Yes. If your employer pays you less than the HMRC approved mileage rate (or nothing at all), you can claim Mileage Allowance Relief (MAR) for the difference. For example, if your employer pays 30p per mile and the approved rate is 45p, you can claim tax relief on the 15p shortfall per mile. You claim MAR via a P87 form or through your Self Assessment return.

Do the HMRC mileage rates apply to electric vehicles?

Yes. As of 2026, electric and hybrid vehicles use the same HMRC approved mileage rates as petrol and diesel cars — 45p per mile for the first 10,000 miles and 25p above that. HMRC has not introduced a separate higher rate for electric vehicles to reflect lower running costs, though this has been discussed. The Advisory Electric Rate (AER) for company car drivers (where the company owns the car) is different and set quarterly.

Who can use HMRC approved mileage rates?

The approved mileage rates can be used by: (1) employees using their own vehicle for business travel — they can claim relief on any shortfall between the approved rate and what the employer pays; (2) self-employed individuals — they can claim the approved rate against business profits on their Self Assessment return as an alternative to claiming actual vehicle costs.

HMRC Approved Mileage Rates 2026/27 — Cars, Motorcycles & Bikes

The HMRC Approved Mileage Allowance Payment (AMAP) rates set the maximum amount that can be paid or claimed tax-free when using a personal vehicle for business travel. For 2026/27, the approved rate for cars and vans is 45p per mile for the first 10,000 business miles and 25p per mile above 10,000 miles in the tax year. These rates have remained unchanged since 2011. Employees, self-employed people, and volunteers can all use these rates.

Quick answer: If you drive your own car for work (not commuting — purely business journeys), you can claim 45p per mile for the first 10,000 miles each tax year. If your employer pays you less than 45p, you can claim the shortfall as tax relief. Self-employed people can use these rates instead of tracking actual vehicle costs.

HMRC Approved Mileage Rates 2026/27

Vehicle Type	First 10,000 Miles	Above 10,000 Miles
Cars and vans	45p per mile	25p per mile
Motorcycles	24p per mile	24p per mile
Bicycles	20p per mile	20p per mile

Passenger payment (carried as part of a business journey): additional 5p per mile per passenger.

Who Can Use These Rates?

Employed People

If you use your own car for business travel (not ordinary commuting), your employer can pay you up to the approved rate tax-free. If they pay less — or nothing — you can claim Mileage Allowance Relief (MAR) on the difference.

What counts as business travel:

Visiting clients or customer sites
Travelling between different workplaces
Temporary workplace assignments
Attending training away from your usual workplace

What does NOT count:

Ordinary commuting from home to your permanent workplace
Personal journeys

Self-Employed People

If you are self-employed, you can claim the approved mileage rate as a business expense on your Self Assessment tax return — instead of claiming actual vehicle costs (fuel, insurance, MOT, depreciation etc.). Once you choose the mileage method for a vehicle, you must continue to use it for that vehicle for as long as you use it in the business.

Important: The flat-rate mileage method for self-employed people is called the simplified expenses method. It is simpler but not always optimal — compare against actual costs for high-mileage drivers.

How Mileage Allowance Relief (MAR) Works for Employees

If your employer pays you less than the approved rate, or pays nothing, you can claim back the tax on the shortfall.

Worked example:

Sarah is a nurse who drives to community patients using her own car. She drove 8,000 business miles in the 2025/26 tax year. Her employer paid her 20p per mile.

Calculation	Amount
Approved AMAP rate (8,000 miles × 45p)	£3,600
Employer paid (8,000 × 20p)	£1,600
Shortfall eligible for MAR	£2,000
Tax relief (at 20% basic rate)	£400 back
Tax relief (at 40% higher rate)	£800 back

Sarah claims the £2,000 shortfall as MAR. If she is a basic-rate taxpayer, she gets £400 in tax relief.

How to Claim MAR

If you do not complete a Self Assessment return:

Use Form P87 (available on GOV.UK or via HMRC online)
Claims can be made for the current year and up to 4 prior tax years

If you complete a Self Assessment return:

Enter the approved amount and the amount received from your employer on your return — HMRC calculates the relief automatically

The Passenger Rate

If you carry colleagues as passengers on a business journey (not family or friends), you can claim an additional 5p per mile per passenger on top of your regular mileage rate. This is paid separately by the employer or claimed via Self Assessment.

Example: You drive 50 miles with a colleague to a client meeting. You can claim:

Car mileage: 50 × 45p = £22.50
Passenger: 50 × 5p = £2.50
Total claimable: £25.00

Electric and Hybrid Vehicles

Electric vehicles (EVs) and plug-in hybrids use the same AMAP rates as petrol and diesel cars: 45p/25p for cars, 24p for motorcycles. There is no higher rate to reflect the lower electricity cost compared to petrol.

Advisory Electric Rate (AER): This is a separate rate set by HMRC each quarter for company cars (where the employer owns the vehicle). It applies when the employee is reimbursing the employer for private fuel/electricity. For 2025/26, the AER was approximately 7p per mile — very different from the AMAP rate and applicable in different circumstances.

Self-Employed: Mileage vs Actual Costs

If you are self-employed, you choose between two methods for claiming vehicle costs:

Method	Best For	Complexity
Approved mileage rate (simplified expenses)	Lower mileage drivers; new vehicles	Simple — just log miles
Actual costs (plus capital allowances)	High mileage; older or cheaper vehicles	Complex — track all costs

Example of when actual costs win: You drive 25,000 business miles per year in a van. At 45p × 10,000 + 25p × 15,000 = £4,500 + £3,750 = £8,250. Your actual costs (fuel, insurance, road tax, servicing) may be £12,000+. Claiming actual costs gives a much larger deduction.

Always calculate both methods in your first year with a vehicle before committing.

Record-Keeping Requirements

Whether employed or self-employed, HMRC requires you to keep a mileage log to support your claims:

Date of each journey
Start and end location (or purpose of journey)
Business purpose
Number of miles
Total miles in the tax year

A simple spreadsheet or dedicated app (MileIQ, TripLog, etc.) satisfies this requirement. Keep records for at least 5 years from the 31 January Self Assessment deadline.

UK Self-Employed Tax Guide — allowable expenses, National Insurance, and Self Assessment
UK National Insurance Guide — Class 2 and Class 4 NI for self-employed
HMRC Self Assessment Guide — how to file your tax return
UK Taxes Hub — full range of UK tax guides

HMRC mileage rates are one of the most overlooked tax reliefs for UK workers. If you drive for work and your employer underpays (or pays nothing), a P87 claim for back years can produce a useful tax refund with minimal paperwork.

Written by WealthVieu

WealthVieu researches and writes data-driven personal finance guides using primary sources including the IRS, Bureau of Labor Statistics, Federal Reserve, and Census Bureau.

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