Last checked October 2026 · by the PaySorted team
The rates for 2026/27
| Vehicle | 2026/27 | Before 6 April 2026 |
|---|---|---|
| Cars and vans: first 10,000 business miles | 55p | 45p |
| Cars and vans: after 10,000 miles | 25p | 25p |
| Motorcycles | 24p | 24p |
Example: 12,000 business miles in a van in 2026/27 = (10,000 × 55p) + (2,000 × 25p) = £6,000 off your taxable profit.
How it works
This is HMRC's "simplified expenses" option for sole traders and partnerships (not limited companies). Instead of adding up fuel, insurance, servicing, road tax and depreciation, you multiply your business miles by the flat rate. Parking and tolls on business trips can still be claimed on top.
The rules to know:
- Once you use the flat rate for a vehicle, you must keep using it for as long as you use that vehicle in the business.
- You can't use it for a vehicle you've already claimed capital allowances on, or whose costs you've already claimed.
- You can use the flat rate for one vehicle and actual costs for another.
Mileage rate or actual costs?
The flat rate tends to suit you if you do lots of miles in a cheap-to-run, older or already-paid-for vehicle. Actual costs plus capital allowances tend to suit you if you've just bought an expensive van, or your van is expensive to run and you do fewer miles.
Because you're locked in once you choose the flat rate for a vehicle, it's worth a quick word with your accountant before you decide.
What counts as a business mile?
You can't claim commuting. For trades, HMRC's own guidance is helpful: if your home is your base and you travel to different customers' sites, that travel is normally business travel. This comes from a long-standing tax case about a bricklayer who kept his tools and records at home and worked on short-term sites.
- Home → customer's house → merchant → next job: business miles
- Home → the same yard or unit every day: commuting
- Personal detours: not business
Keep a mileage log
HMRC says to keep a record of your business miles. A good log has the date, where you went from and to, the reason (the job or customer) and the miles. Keep it for at least 5 years after the 31 January filing deadline.
In PaySorted you can record business mileage alongside your jobs, invoices and expenses, so everything is in one place for your accountant.
General information based on gov.uk guidance (checked October 2026), not tax advice. Rates apply to self-employed simplified expenses for the 2026/27 tax year.
Common questions
What is the HMRC mileage rate for 2026/27?
55p a mile for the first 10,000 business miles in a car or van, then 25p a mile. Motorcycles are 24p a mile.
Can I claim mileage and fuel?
No. The mileage rate already covers fuel, insurance, repairs, servicing, road tax and depreciation. You can still claim parking and tolls.
Can a limited company director use simplified mileage?
Not as simplified expenses — those are for sole traders and partnerships. Company directors use the approved mileage allowance payments rules instead.
Is driving to jobs from home a business mile?
Normally yes, if your home is the base of your business and you travel to different customers' sites. Travelling to the same fixed workplace every day is commuting.