On the 6th April 2026, HMRC increased the approved mileage rate to 55p per mile for the first 10,000 business miles. It's a helpful change for employees and the self-employed, and it may be worth reviewing reimbursements, payroll and expense systems ...
HMRC mileage rate increase provides a higher reimbursement for business travel expenses
This is a notable change for anyone who uses a personal car or van for work. The updated mileage allowance applies to the first 10,000 business miles in the tax year and is a long-awaited response to rising motoring costs.
For employees, the practical effect is straightforward!
If a business reimburses mileage at the HMRC-approved rates, the reimbursement can now be higher and remain tax-free under the usual rules. That matters because business mileage is one area where small changes can quietly make a meaningful difference over the course of a year.
The increase also affects the self-employed who claim travel expenses using HMRC mileage rates rather than calculating actual vehicle costs. For many, the simplicity of the mileage allowance is part of its appeal, and the rise in the HMRC mileage rate makes that route a little more generous from the start of the 26/27 tax year.
It is also worth noting that the rate above 10,000 miles remains at 25p per mile. That means the HMRC mileage rate rise helps most with the earlier miles in the year, which is often where many drivers do the bulk of their qualifying journeys anyway.
What makes this update particularly interesting is that it has been backdated to the 6th April 2026, even though the confirmation arrived in May. In other words, the revised figure applies to the entire tax year, so businesses and individuals may need to review how mileage has already been processed.
The mileage rate rise may also matter for staff who are reimbursed below the approved amount!
In some cases, they may be able to claim tax relief from HMRC for the difference, provided they meet the conditions. That is one of those details that can be easy to miss when travel expenses are handled informally.
For employers, this is a sensible time to review mileage reimbursement policies, payroll settings, and expense systems. A clean update now can help avoid confusion later, especially when HMRC rates are embedded in finance processes or employee handbooks.
The broader message is simple enough: the rise in the HMRC mileage rate brings the approved rate closer to today's running costs and provides both businesses and workers with a clearer benchmark.
For anyone tracking business mileage, this change is useful, and for many, it should make tax-free mileage claims a bit more rewarding.
If anything I've written in my blog post resonates with you and you'd like to discover more of my thoughts about the HMRC mileage rate rise, then do call me on 01908 774320 and let's see how I can help you.
Don't forget to stay updated with our daily social media posts on Facebook.
Roger trained at Edward Thomas Peirson & Sons in Market Harborough before working at Hartwell & Co, followed by Chancery, as a partner. He started Essendon Accounts and Tax with Helen Beaumont in 2014 as a general practitioner with a hands-on approach.
Roger loves getting his hands dirty, working with emerging, small-to-medium and family businesses to ensure they receive the best possible accountancy advice. Roger utilises an extensive network of business contacts to leverage the best guidance and practical solutions.
AI-based fraud detection is set to help HMRC spot mistakes, suspicious patterns and missed payments more quickly. The idea is simple: artificial intelligence supports staff, while people still make the final call ......
Many business owners and savers may have received messages from their bank about changes to the Financial Services Compensation Scheme (FSCS). The key update is that the protection limit for eligible deposits has increased fr...
UK economic growth has remained surprisingly resilient, but higher prices are making households and firms more cautious. The big question is whether inflation costs translate into lasting wage pressure, which would force the ...
The 2026 King's Speech points to faster payments, smarter regulation and tougher cyber rules. It also signals a more pro-growth approach to government policy, with businesses likely to feel the impact quickly ......
British businesses facing financial stress are feeling the squeeze from higher taxes, rising costs and shaky consumer confidence. Hospitality and leisure are under the most pressure, while many firms are also grappling with c...
Personal tax thresholds are drawing fresh attention as campaigners argue for a £18,000 allowance before anyone pays tax. The Treasury says the cost would be huge, but supporters say British taxpayers on modest wages need reli...
Britain's economic problems may ease if the US-Iran war ends, but the country still faces sticky inflation, rising bills, costly borrowing and fragile confidence in the government. The real story is that energy relief would h...
Tough markets can tempt firms to tighten payment terms, but that usually weakens trust. To strengthen relationships with suppliers, businesses need clearer communication, fairer timing and a more joined-up approach ......
Wondering where corporate visitors stay in Milton Keynes? You'll see why many teams pick serviced accommodation from Short Stay : MK over hotels and A ...
If you want to advance your career, your skills and experience certainly matter. However, the way you approach challenges, setbacks, and opportunities ...
Most business owners assume that when a visitor leaves their website, it is because the site did not look professional enough, the prices were too hig ...
When most people think about buying property, they often focus on finding their dream home. Property investors look at things rather differently ... ...
All content on this blog, including but not limited to text, images, videos and audio, is protected by copyright. No part of this blog may be reproduced, copied, distributed, or otherwise used without the prior written consent of the author. Unauthorised use constitutes a breach of intellectual property rights.
Please note that many elements of this blog have been created using Artificial Intelligence (AI). As such, content may not always reflect verified facts or professional advice. The information provided is for general interest only and should not be relied upon as a sole source for making decisions, financial or otherwise. Readers are strongly advised to seek independent advice from qualified professionals appropriate to their country and situation.
The author of this blog, YourPCM Limited, and its directors, employees, and authorised agents accept no liability for any loss, harm, or consequence arising from the use or interpretation of content found on this site.
The sblogit.com platform is provided on an “as is” basis. By continuing to view or interact with this blog, you acknowledge and accept these terms. If you do not agree with any part of this notice, please cease using this site immediately.
YourPCM Limited is a company registered in the UK and operates exclusively under the jurisdiction of the laws of England and Wales.
