HM Revenue and Customs (HMRC) has confirmed that drivers using their own cars for work purposes can claim 45p per mile for the first 10,000 miles during the 2026-27 tax year, dropping to 25p per mile thereafter. The relief covers both fuel costs and vehicle wear and tear, offering significant support for those who travel regularly for work.
Who Can Claim Mileage Relief
Employees who use their own cars for business trips—such as visiting clients, attending meetings, or traveling between sites—can claim this mileage relief. Tradespeople and workers who are not reimbursed by employers can claim directly from HMRC. Commuting to a regular workplace or personal trips, even if taken during work hours, cannot be claimed.
The relief also applies to electric vehicle (EV) drivers, who can claim the same 45p per mile for the first 10,000 miles and 25p per mile thereafter. EV owners benefit particularly as charging costs can be as low as 5p per mile, which means a large portion of the mileage allowance goes straight toward additional savings. EVs registered before March 31, 2017, and under £40,000 also qualify for lower vehicle tax, making electric work travel even more economical.
How to Claim
To make a claim, drivers must keep accurate records of all business journeys, including mileage, dates, destinations, and reasons for the trips. Employers can also claim an extra 5p per mile per passenger if carrying colleagues on business journeys. HMRC processes these claims either through an employer’s payroll or directly for employees who are not reimbursed.
The relief ensures drivers are repaid for fuel and wear and tear, which has become increasingly important as petrol prices remain high, with some cars spending up to 20p per mile on fuel alone. The system also encourages the use of EVs for work travel, aligning financial and environmental incentives.
Why This Matters
With rising energy and fuel costs, the mileage allowance provides a meaningful way for workers to offset the expenses of business travel. It benefits both petrol and electric vehicle owners, offering direct savings and reducing the financial strain of using a personal car for professional purposes.
Drivers planning to claim should maintain accurate logs to ensure full repayment. With the 2026-27 rates confirmed, both petrol and EV users can now confidently calculate the tax relief they are entitled to, helping manage costs in an era of high fuel prices and rising living expenses.
