How do I claim business mileage?

For cars and vans you can claim 55p per mile for the first 10,000 business miles in the tax year, then 25p per mile after that. Motorcycles are 24p per mile. These are the 2026 to 2027 rates. From 6 April 2027 the rate above 10,000 miles rises from 25p to 35p, and the 55p rate stays.

Example: 11,000 business miles in the year is £5,750 (10,000 at 55p plus 1,000 at 25p).

• Sole traders can choose between these simplified rates and claiming actual vehicle costs. Once you use the flat rates for a vehicle you must carry on using them for as long as you use that vehicle for the business. You cannot use them for a vehicle you have already claimed capital allowances on. Parking and train fares can be claimed on top.
• Limited companies can reimburse directors and employees tax-free up to the approved rates (bicycles are 20p a mile). Anything paid above the approved rate is taxable and goes through payroll.

Ordinary commuting to a permanent workplace does not count as business mileage. Keep a log for every trip with the date, start and end points, the reason for the journey and the miles, because it is your evidence if HMRC asks.

Legislation and guidance: Income Tax (Trading and Other Income) Act 2005, section 94D (fixed rate deduction for vehicles, sole traders); Income Tax (Earnings and Pensions) Act 2003, section 229 and section 230 (approved mileage allowance payments for employees and directors); HMRC Business Income Manual BIM75005 and Employment Income Manual EIM31230.