HMRC has announced an increase in the approved mileage rates for employees and those who are self employed. Any claims backdating to 6th April 2026 should be paid at the new increased rate. The rate increase reflects the rising costs of owning, maintaining and running a vehicle.
The approved mileage rates are intended to cover the day-to-day running costs of the vehicle, including fuel, servicing, maintenance and repairs. Other business travel expenses can still be reimbursed separately. Costs such as parking fees, road tolls and congestion charges can also be claimed as a business expense. But it’s worth noting that this does not extend to personal penalties, such as parking fines or speeding tickets, which remain the responsibility of the driver of the vehicle!
The basic rate, for claims up to 10,000 miles per year using a car or van has increased by 10p per mile from 45p per mile to 55p per mile. However, the rate for mileage above 10,000 miles remains unchanged from 2011.
Revised rates for approved mileage from 6th April 2026
| Vehicle Type | First 10,000 business miles in the tax year | Each business mile over 10,000 in the tax year |
| Car/Van | 55p | 25p |
| Motorcycles | 24p | 24p |
| Bicycles | 20p | 20p |
Rates for approved mileage from 2011 – 6th April 2026
| Vehicle Type | First 10,000 business miles in the tax year | Each business mile over 10,000 in the tax year |
| Car/Van | 45p | 25p |
| Motorcycles | 24p | 24p |
| Bicycles | 20p | 20p |
Sole traders:
If you’re using a car or a van you’ll be able to apply the new 55p rate to all qualifying business mileage driven in the 2026/27 tax year. If the Gooding Accounts team complete your Income Tax Self Assessment (tax return) we’ll ensure that this is adjusted to reflect the increase.
Employers:
Whilst employers are not legally required to increase their rates to reflect the updated approved mileage cost – many will. You should check the official HMRC Travel Mileage and Fuel Rates and adjust your payroll and expense policies accordingly. If the Gooding Accounts team look after your payroll we can offer advice on making changes any mileage expenses.
Employees:
You should review any mileage claims you have already submitted since 6th April 2026. If your employer is now paying the HMRC approved rate you may be entitled to a ‘top-up’ payment that reflects the 10p per mile increase.
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