HMRC mileage rates explained
After spending more than a decade frozen in time, HMRC mileage rates finally got an update in April 2026.
Stuck at the same rate since 2011, the approved mileage allowance payment (AMAP) rate has finally increased to 55p per mile for the first 10,000 miles travelled in a tax year – up from the previous rate of 45p per mile.
This change applies to anyone using their own vehicle for business journeys but NOT commuting – including care workers, field-based employees, sales reps and self-employed people who drive for work.
HMRC Approved Mileage Allowance Payments (AMAP) rates 2026
From April 2026, employees using their own vehicle for business travel can claim:
- 55p per mile for the first 10,000 business miles in the tax year
- 25p per mile for any business miles over 10,000
These rates apply regardless of a vehicle’s fuel type – petrol, diesel, hybrid or electric.
Passengers: Where a person is taking a fellow employee on the same business journey a passenger, they can claim a further 5p per mile. The 5p per mile passenger rate applies per passenger, not per journey.
Other approved rates – and no 10,000‑mile limit for either:
- Motorcycles: 24p per mile
- Bicycles: 20p per mile
These updated HMRC mileage rates are supposed to cover the cost of running the vehicle, such as fuel, repairs and servicing.
Are you paying employees above the 55p mileage rate?
If an employer decides to pay above the HMRC approved 55p rate, then unless that employer is payrolling benefits, the excess amount above the threshold should be shown on the benefit form P11D and taxed on the individual following the end of that year.
Class 1 NI should be suffered through the payroll system. However, only with regards to the excess above 45p per mile, irrespective of how many business miles are executed during the year.
Getting paid below the 55p mileage rate?
There may be cases where employers pay below the approved mileage rate or not at all. If that happens, employees can claim the tax back on the difference between what has been reimbursed and the HMRC approved rate.
This can be done either online through the Revenue’s website or through their self-assessment tax return. However, the passenger rate of 5p per mile cannot be claimed this way.
Always keep accurate mileage records
It is important for both employees and employers to keep proper records to evidence the business mileage done, stating where the journey took place to and from, the purpose of the trip and details of any person travelling with them.
Can you claim parking tickets & road tolls?
Costs such as parking, road tolls or congestion charges can be reimbursed by employers without tax or national insurance (NI) being payable, but this is NOT the case if an employee is handed a parking fine or speeding fine.
Can a director claim more than 55p per mile?
Yes, but only in certain circumstances if your vehicle is NOT a company-owned car.
If you use your own car for business travel, you can claim:
- 55p per mile for the first 10,000 miles
- 5p passenger rate if you carry other employees on same business journey
- The additional 5p applies per passenger, not per journey
- Passengers must also be travelling for business purposes
- They must be employees – not clients
- You only claim while they are actually in the vehicle
In theory, if you had multiple employees in the car, you could claim an additional 5p per mile for each passenger.
