Claiming business mileage on your own car

If you use your own car to make business journeys, you can claim tax relief on your mileage up to the current rates allowed by HM Revenue & Customs.

The current rates are:

• 45p per mile for the first 10,000 business miles in a tax year
• 25p per mile for any miles over 10,000 in the same year

Current rates can be checked by clicking here.

If you are paid over your allowable amount, the excess is treated as a benefit in kind and you will pay tax on it. However, if your employer pays less than the full claim, you can claim Mileage Allowance Relief on the difference.

To claim relief, you need to keep a record of the business mileage you have done in the year along with details of how much your employer has paid you for these miles. You will then need to complete a Form P87 or a tax return.

If your claim is over £2,500 you will need to complete a tax return to make the claim instead of Form P87.

What counts as business mileage can also be a complicated area and your local TaxAssist Accountant would be happy to discuss this in more detail and help you make a claim. A free mileage tracker is also included within our mobile app, which can be downloaded from the Apple and Google Play stores.

Date published 1 Jun 2017

This article is intended to inform rather than advise and is based on legislation and practice at the time. Taxpayer’s circumstances do vary and if you feel that the information provided is beneficial it is important that you contact us before implementation. If you take, or do not take action as a result of reading this article, before receiving our written endorsement, we will accept no responsibility for any financial loss incurred.