FullWorkings UK tax and finance calculators

Mileage allowance

2026-27

The driving

Business miles this yearNot commuting — that is ordinary travel and does not count.
VehicleYour own, not a company one.
What your employer paid youTotal mileage payments for the year. Leave blank if nothing. £
Your tax rateRelief is worth the tax you would have paid, so the rate matters.

Passengers

Miles with passengersOnly fellow employees, on the same business journey.
How many passengersPaid per passenger, per mile.

The approved amount

What you could be paid tax-free £0.00 for the year
Miles at the first rate0
...worth£0.00
Approved amount£0.00

Against what you were paid

Verdict—
Paid by your employer£0.00
Advertisement

How this is worked out

The approved amount is what an employer can pay for business travel in your own vehicle without it becoming taxable pay. If they pay less, you can claim tax relief on the difference. If they pay more, the excess is pay.

⚠ The car rate changed on 6 April 2026

It rose to 55p for the first 10,000 miles, after fourteen years at 45p. A great deal of published material — and a good many employer policies — still says 45p, so this is worth checking rather than assuming.

⚠ Relief is the tax, not the shortfall

If your employer pays £500 less than the approved amount, you do not get £500 back. You get the tax you would have paid on it — £100 at the basic rate, £200 at the higher rate. Sites that report the shortfall as "what you can claim" overstate it fivefold, and it is the most common thing to get wrong about this relief.

The 10,000-mile step is only for cars and vans

A motorcycle is one rate for every mile, and so is a bicycle. Applying the car's step to them is wrong in the expensive direction, because the second car rate is lower than the first.

Passenger payments are separate, and carry no relief

An employer can pay 5p a mile for each fellow employee carried on the same business journey. But gov.uk is explicit that there is no equivalent of Mileage Allowance Relief for them: if your employer does not pay it, you cannot claim it. That is why the relief figure above ignores them.

Commuting is not business travel

The journey between home and a permanent workplace is ordinary commuting, and none of it counts. Travel to a temporary workplace does, and so does travel between workplaces — the distinction is where most disputed claims start.

What this does not cover

Company cars, which use advisory fuel rates instead and are a different calculation entirely. The National Insurance version of this, which uses one flat rate for every mile rather than a step at 10,000. Vehicles owned by a business rather than by you. Volunteer driving, which has its own arrangements. And the actual-cost basis, which the self-employed may use instead of mileage rates but cannot switch away from once chosen for a vehicle.

Where these figures come from

Every rate above is read from a dated rate file rather than written into the page, and each one is checked against the gov.uk page it came from. How these numbers are kept right sets out the whole process.

Self-employed tax calculator