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Tax relief for business mileage

You may be able to get tax relief for business mileage if you use your own vehicle for work. It can be a car, van, motorcycle or cycle.

What counts as business mileage?

Business mileage is mileage you travel doing your job. It can include travel to a temporary work place but it doesn't include:

• normal travel between home (or anywhere that is not a workplace) and your permanent workplace 
• private travel

Mileage Allowance Relief (MAR)

You can get tax relief for some or all of your business mileage by getting MAR. You can work out the amount of MAR you are entitled to by multiplying the number of business miles you travel by the approved mileage rate for your vehicle.

You are only entitled to MAR if your employer pays you: 

• no mileage allowance 
• less than the approved mileage allowance rate

If your employer pays you more than the approved mileage rate, you'll have to pay tax on the extra.

• Details of approved mileage rates Opens new window

How to calculate MAR

To calculate MAR:

• add up your business miles travelled in the tax year
• multiply your business miles by the approved mileage rate to work out the approved amount 
• add up any mileage allowance payments received from your employer
• compare any mileage allowance payments received with the approved amount

If the approved amount's more, you're entitled to MAR on the difference.

For example, you use your own car for 850 business miles and your employer pays you 30p per mile. The approved amount is £340 (850 times 40p). The allowance you get from your employer is £255 (850 times 30p). Your MAR is £85 (£340 less £255).

Records you must keep

You need to keep records of dates, mileage and details of all work journeys. Your employer needs this information to make expenses payments to you. You also need them to get any MAR.

If you use different vehicles

If you use more than one vehicle of the same kind add all your business miles together in one calculation. If you use vehicles of different kinds make separate calculations for each one.

• Find out how vehicles are grouped Opens new window

If you work for different employers

If you have two or more employers which are independent of each other, you're due the higher mileage rate for business mileage in each job.

Tax relief for fuel when using a company vehicle

If you pay for fuel when using a company vehicle for business travel you can get tax relief on fuel costs, less any payments repaid by your employer and covered by a 'dispensation'. You must keep a record of your business mileage to calculate your expenses.

How to get tax relief

To find out how you can get tax relief for your business mileage or fuel follow the link below 'How to get allowances and reliefs - employees or directors'.

If you haven't completed a tax return you've got five years from the 31 October following the end of the year concerned to get the relief. If you've previously completed a return it's five years from 31 January following the end of the year concerned.

• How to get allowances and reliefs - employees or directors

More useful links

• Tax allowances and reliefs - more information

• Tax allowances and reliefs - employees or directors