What is the mileage allowance rate in 2026/27?

For a car or van, 55p a mile for the first 10,000 business miles in the tax year and 25p a mile after that. Motorcycles are 24p and cycles 20p for every mile. 12,000 business miles by car gives an approved amount of £6,000.

What if my employer pays less than the approved rate?

The difference between the approved amount and what the employer paid can be claimed as Mileage Allowance Relief, a deduction from taxable income. It is worth the tax on that amount: 20% for a basic rate taxpayer and 40% for a higher rate taxpayer in England, Wales and Northern Ireland. 5,000 miles paid at 25p a mile leaves £1,500 of relief, which takes £300 off a basic rate taxpayer's income tax.

What happens if my employer pays more than the approved amount?

The part above the approved amount is taxed as pay. The employer reports it or adds it to pay through the payroll. The tool shows the excess when the amount paid is higher than the approved amount.

What changes for mileage on 6 April 2027?

The car and van rate above 10,000 miles moves from 25p to 35p, as set out in the Budget 2026 overview of tax legislation and rates. The rate for the first 10,000 miles and the motorcycle and cycle rates are unchanged. 12,000 miles by car gives £6,200 in 2027/28, against £6,000 in 2026/27.

Can I claim mileage for commuting?

No. Travel to and from your usual place of work is not business mileage. Travel to a temporary place of work counts. Only miles in your own vehicle are covered here; a company car has its own rules.

Calculators

Mileage allowance calculator

Tax year 2026/27, for England and Northern Ireland, Scotland, Wales. Shows the approved amount for business miles in your own vehicle, and the Mileage Allowance Relief and tax taken off when an employer pays less.

Results update as you type. Your inputs are kept in this browser and are never sent anywhere.

Approved mileage amount

£6,000a year

Paid by your employer: £3,000
Mileage Allowance Relief: £3,000
Tax taken off: £600

The approved amount is £6,000.00. The employer paid £3,000.00, leaving £3,000.00 of Mileage Allowance Relief, which takes £600.00 off income tax.

Under 2027/28 as announced so far, the same inputs give £6,200.00 of approved mileage, £200.00 more than in 2026/27. The car rate above 10,000 miles moves from 25p to 35p.

The working

The approved amount for 12,000 business miles by car or van in 2026/27
Line	Rate	On	A year	Source
			£5,500.00	gov.uk
10,000 miles × 55p = £5,500.00. Checked 7 November 2026, in force.
			£500.00	gov.uk
2,000 miles × 25p = £500.00. Checked 7 November 2026, in force.
			£6,000.00
What an employer can pay for 12,000 business miles in the year free of tax: £6,000.00.
			£3,000.00
Mileage payments received in the year for these miles: £3,000.00.
			£3,000.00	gov.uk
The employer paid less than the approved amount, so the unused balance can be claimed as a deduction from taxable income: £6,000.00 − £3,000.00 = £3,000.00. Checked 7 November 2026, in force.
	20%	£3,000.00	£600.00	gov.uk
Income tax on £40,000.00 is £5,486.00; on £37,000.00 it is £4,886.00. The relief is worth £600.00. Checked 7 November 2026, in force.

How this is calculated

Approved amount. Business miles in the tax year times the rate for the vehicle: 55p for the first 10,000 miles by car or van and 25p after that, 24p by motorcycle, 20p by cycle.
What the employer paid. Mileage payments up to the approved amount are free of tax. Anything above it is taxed as pay.
Mileage Allowance Relief. If the employer paid less, the unused balance of the approved amount is a deduction from taxable income.
Tax taken off. Income tax on your taxable income with and without the deduction, at the bands for the nation chosen. The difference is what the relief is worth.

The rounding conventions are listed in the methodology, and the formulas run from the open rules file for 2026/27.

Rules used

Tax year: 2026/27 (6 April 2026 to 5 April 2027)
Nation: England and Northern Ireland
Figures: Checked on 7 November 2026. Status: in force.
Next scheduled change: 6 April 2027
Every figure: Rates and allowances for 2026/27, each with its source and the date it was checked.
Sources used: Rates and thresholds for employers 2026 to 2027, checked 7 November 2026
Income tax rates, checked 7 November 2026

What changes on 6 April 2027

Of the figures this result uses, one changes in 2027/28.

Figure	2026/27	2027/28	Source	Status
Car mileage, after the first band, per mile	25p	35p	gov.uk	Announced

Switch the tax year in the form to see the result under 2027/28 as announced so far. The Budget 2026 page lists every measure, including those that do not touch this result.

What this does not do. It covers employees using their own car, van, motorcycle or cycle, one vehicle type at a time. It does not model company cars, passenger payments, the self-employed simplified mileage rates, National Insurance on mileage payments or relief for earlier tax years. It never suggests whether to make a claim.

Questions people ask

What is the mileage allowance rate in 2026/27?: For a car or van, 55p a mile for the first 10,000 business miles in the tax year and 25p a mile after that. Motorcycles are 24p and cycles 20p for every mile. 12,000 business miles by car gives an approved amount of £6,000.
What if my employer pays less than the approved rate?: The difference between the approved amount and what the employer paid can be claimed as Mileage Allowance Relief, a deduction from taxable income. It is worth the tax on that amount: 20% for a basic rate taxpayer and 40% for a higher rate taxpayer in England, Wales and Northern Ireland. 5,000 miles paid at 25p a mile leaves £1,500 of relief, which takes £300 off a basic rate taxpayer's income tax.
What happens if my employer pays more than the approved amount?: The part above the approved amount is taxed as pay. The employer reports it or adds it to pay through the payroll. The tool shows the excess when the amount paid is higher than the approved amount.
What changes for mileage on 6 April 2027?: The car and van rate above 10,000 miles moves from 25p to 35p, as set out in the Budget 2026 overview of tax legislation and rates. The rate for the first 10,000 miles and the motorcycle and cycle rates are unchanged. 12,000 miles by car gives £6,200 in 2027/28, against £6,000 in 2026/27.
Can I claim mileage for commuting?: No. Travel to and from your usual place of work is not business mileage. Travel to a temporary place of work counts. Only miles in your own vehicle are covered here; a company car has its own rules.

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