What is Mileage Allowance? UK Definition 2026/27
Quick Answer
Tax-free payments for using your own vehicle for business travel.
Definition of Mileage Allowance
Mileage Allowance Payments (MAPs) allow tax-free reimbursement for business miles in your own vehicle. The approved rates are 45p per mile for the first 10,000 miles, then 25p. If your employer pays less (or nothing), you can claim Mileage Allowance Relief for the difference through Self Assessment.
Mileage Allowance — Key Facts for 2026/27
| First 10,000 miles | 45p/mile |
| Over 10,000 miles | 25p/mile |
| Motorcycle | 24p/mile |
| Bicycle | 20p/mile |
How Mileage Allowance Works — Example
- 1Business miles: 12,000
- 2First 10,000 × 45p = £4,500
- 3Next 2,000 × 25p = £500
- 4Total claim: £5,000
- 5Tax relief at 40%: £2,000
How Mileage Allowance Affects Your Tax
Business mileage is valuable tax relief but must be properly recorded. Keep a mileage log with date, destination, purpose, and miles. Commuting doesn't count - only travel in the course of work.
Official HMRC Guidance on Mileage Allowance
For official guidance, refer to HMRC's documentation. Tax rules can change, so always verify current rates and thresholds on gov.uk.
HMRC: Mileage ratesFrequently Asked Questions about Mileage Allowance
Accuracy Note
This information is for guidance only and is based on 2026/27 tax year rates. Tax rules are complex and your circumstances may differ. For personal advice, consult a qualified accountant or tax adviser.