Many employees are required to travel for work purposes and could be eligible for UK Tax Relief On Business Mileage. Whether you use a company provided car or your own car, whether you are reimbursed by your employer or not, there are specific conditions that must be met to determine your eligibility to UK tax relief on business mileage.
This guide explains the eligibility conditions as well as the practical steps required to claim UK tax relief on business mileage minimising your UK tax liability where possible.
If you would like to discuss the UK Tax Relief On Business Mileage and how this impacts you, please contact us at Expat Tax Solutions.
Which Journey Types Are Eligible For UK Tax Relief On Business Mileage?
In order for a journey to be eligible for UK tax relief on business mileage, the journey must wholly, exclusively and necessarily for business purposes. Typical examples will therefore include travelling to visit suppliers and clients, or travelling to a location other than your main office for a meeting or training purposes.
There is a specific exclusion which prevents claims for mileage relating to ‘ordinary commuting’ and therefore your journey from home to the office is not eligible for UK tax relief on business mileage.
If your place of work is a ‘temporary workplace’ then relief may be available as this is not categorised as ordinary commuting. A temporary workplace is a location that you are required to attend for a period not exceeding 24 months or a work location that you attend for fewer than 40% of your working time. For example, if you work in Manchester and are seconded to the London office for 18 months, the London office will be a temporary workplace and travel costs will be eligible for tax relief.
A workplace is not temporary if your entire contract is based there even if it is for fewer than 24 months. For example, if you accept a 12 month fixed term contract at an office, this will not be a temporary workplace.
How Much UK Tax Relief On Business Mileage Can I Claim?
Using Your Own Car
When using your own car, you can claim UK tax relief on business mileage at HMRC’s approved mileage rate. This covers the costs of all aspects of running the car including fuel, repairs, MOT etc. and therefore you cannot claim for additional costs incurred.
You should therefore keep a record of all business mileage incurred during the year to calculate and evidence your claim. If your employer reimburses you for any business mileage then this should be factored into your claim and further detail is provided in the following section.
HMRC’s approved mileage rate for 2026/27 is:
| Vehicle Type | First 10,000 Business Miles In The Year | Each Business Mile Over 10,000 In The Year |
|---|---|---|
| Cars and Vans | 45p per mile | 25p per mile |
| Motorcycles | 24p per mile | 24p per mile |
| Bicycles | 20p per mile | 20p per mile |
Using A Company Provided Car
If you use a company provided car, you should not use HMRC’s approved mileage rates to claim UK tax relief on business mileage. Instead you should keep record of the actual amounts spent on fuel/electricity for business trips as the actual amounts can be deducted.
If your employer reimburses you for all fuel on your company car then no additional relief can be claimed and you may be subject to tax on a company car fuel benefit if your employer reimburses the cost for personal journeys.
What If My Employer Reimburses The Cost Of Business Mileage?
Where employees use their own car for business journeys, it is common for their employer to reimburse them for the mileage incurred. If the reimbursement is made at the HMRC approved mileage rate above, this reimbursement is not subject to tax and you cannot claim any additional UK tax relief on business mileage so no further action is required.
If your employer reimburses you at a lower rate than HMRC’s approved mileage rate, you can claim UK tax relief on business mileage which is demonstrated in the following example:
Employee A drives 2,000 business miles during the year and their employer reimburses them at a rate of 20p per mile. The total reimbursement received is therefore £400 (2,000 x 20p).
As HMRC’s approved mileage rate for the first 10,000 business miles is 45p per mile, the employee can claim tax relief on the difference between HMRC’s rate and the rate they were reimbursed i.e. 25p per mile.
The employee can therefore claim a business mileage deduction of £500. (2,000 x 25p). The tax relief available is this figure multiplied by the employee’s marginal tax rate. Assuming the individual is a basic rate taxpayer, their total UK tax relief on business mileage is therefore £100 (£500 @20%).
How Do I Claim UK Tax Relief On Business Mileage?
If you are not in self-assessment
If you do not meet HMRC’s conditions to be required to file a UK self-assessment tax return, you can claim UK tax relief on business mileage by contacting HMRC directly and providing them with the following:
- The reason for every journey
- The postcode for the start point of every journey
- The postcode for the end point of every journey
If you are claiming UK tax relief on business mileage relief worth more than £2,500, you should make this claim via submitting a self-assessment tax return.
If you are in self-assessment
If you are registered for UK self-assessment and file UK tax returns, your claim for UK tax relief on business mileage should be included on your self-assessment tax return. You should keep records of the total business mileage incurred and any reimbursements paid by your employer.
Self-assessment tax returns are due for submission by 31 January following the end of the tax year i.e. the deadline to file your 2025/26 UK tax return is 31 January 2027.
Should you require support preparing and filing your tax return including a claim for UK tax relief on business mileage, please contact us at Expat Tax Solutions.
UK Tax Relief On Business Mileage FAQs
Am I eligible to claim UK tax relief on business mileage?
If you incurred business mileage during the year (trips for work purposes to somewhere other than your usual workplace) and your employer did not reimburse you or reimbursed you at under 45p per mile, you should be able to claim UK tax relief on business mileage.
How much UK tax relief on business mileage can I claim?
The total UK tax relief on business mileage you can claim will typically be at 45p per mile in line with HMRC’s approved mileage rates. This figure is then deducted from your taxable income and so the tax relief you receive is this amount multiplied by your marginal tax rate.
What records should I keep for UK tax relief on business mileage?
You should keep records of business mileage during the year including:
- The reason for every journey
- The postcode for the start point of every journey
- The postcode for the end point of every journey
How do I claim UK tax relief on business mileage?
If you are not registered for self-assessment and your total expense claim is under £2,500, you can claim UK tax relief on business mileage by submitting your mileage records to HMRC.
If you are registered for self-assessment or are claiming over £2,500 in expenses, you should make the claim via your self-assessment tax return.
What if my employer reimburses all of my fuel bills?
If your employer reimburses your business mileage at HMRC’s approved mileage rate (45p per mile), you cannot claim any additional UK tax relief on business mileage.
If your employer also reimburses fuel for your private journeys and you do not repay your employer, you may be subject to tax on a private fuel benefit.
Get Expert Help With UK Tax Relief On Business Mileage
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