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Tax Action tips: Claim your business mileage

Updated 22 December 2022

1min read

Nick Green
Financial Journalist

More Tax Action tips from TaxCalc! This time it’s business mileage… 

Another common area where taxpayers fail to claim relief, is on use of a private vehicle for business purposes. HMRC publish approved mileage rates currently 45p per mile for the first 10,000 miles and 25p per mile over the 10,000 miles.  If your employer does not pay you any mileage allowance or pays you less than the approved HMRC mileage rates you can claim relief for the whole amount or the difference between what is received and the approved rates.

Relief is obtained by reducing your taxable employment income by the amount of mileage claimed.  So for example, if you are a basic rate taxpayer and travelled 5,000 business miles but only received 25p per mile from your employer.  You can claim the remaining 20p per mile against your income, so 5,000 x 20p = £1,000.  So you will save the basic rate of tax against this amount saving £200.00 (£1,000 @ 20%).  If you are a higher or additional rate taxpayer you will save higher amounts.

About the author
Nick Green is a financial journalist writing for Unbiased.co.uk, the site that has helped over 10 million people find financial, business and legal advice. Nick has been writing professionally on money and business topics for over 15 years, and has previously written for leading accountancy firms PKF and BDO.