Mileage allowance relief calculator
Work out the tax back when your employer pays less than HMRC’s approved mileage rate for business journeys in your own car, van, motorcycle or bicycle.
- Tax relief you can claim
- £600
- 20% of the £3,000 your employer didn’t pay
- Approved amount
- £6,000
- 10,000 miles × 55p, then 2,000 miles × 25p
- Your employer paid
- £3,000
- 12,000 miles × 25p
- Mileage Allowance Relief
- £3,000
- the amount you claim, not what you get back
Claims over £2,500 in a tax year go through a Self Assessment return rather than the online or postal form.
HMRC’s approved rates for 2026 to 2027: 55p a mile for the first 10,000 business miles by car or van (45p before 6 April 2026), then 25p; 24p for motorcycles and 20p for bicycles. Business miles are journeys for work in your own vehicle, not your commute to your usual workplace. You get relief at the rate you pay tax on your top slice of income, so if the relief takes you across a band, part of it is at the lower rate. It can’t be more than the tax you paid that year. Passenger payments of up to 5p a mile are tax-free, but there’s no relief if you’re paid less.
What goes in
Pick the tax year and your vehicle, then enter your business miles for the year and what your employer pays a mile. Business miles are work journeys in your own vehicle, not your commute. Choose the rate you pay tax at, with the Scottish bands listed separately.
What the result means
HMRC sets an approved amount for business mileage. If your employer pays less, you can claim tax relief on the difference, called Mileage Allowance Relief. You get back tax on it at your rate, not the whole amount.
For 12,000 miles by car in 2026 to 2027, the approved amount is £6,000: 10,000 miles at 55p and 2,000 at 25p. Paid 25p a mile, you get £3,000, so you can claim relief on the other £3,000. At the basic rate that’s £600 back, or £1,200 at the higher rate.
If your employer pays more than the approved amount, the extra is taxed through your pay.
HMRC’s approved rates
From 6 April 2026 cars and vans get 55p a mile for the first 10,000 business miles in the tax year, up from 45p, then 25p. Motorcycles get 24p and bicycles 20p for every mile. Passenger payments of up to 5p a mile are tax-free, with no relief if you’re paid less.
You can claim for this tax year and the 4 before, with a mileage log showing the reason and start and end postcode of each journey. If you fill in a Self Assessment return, or your expenses for the year are over £2,500, claim on the return. The relief can’t be more than the tax you paid that year.