Mileage allowances

Fuel-only mileage rates

HM Revenue & Customs advisory mileage rates for employee private mileage reimbursement or employer reimbursement of business mileage are:

From 1 July 2009

These mileage rates come into force officially on 1 July 2009. HMRC is content for the new (lower) rates to apply immediately where employers are able and wish to do so.

Baseline fuel mileage rates
	Rates per mile
Engine Capacity	Petrol	Diesel	Gas
Up to 1400cc	10p	10p	7p
1401 - 2000cc	12p	10p	8p
Over 2000cc	18p	13p	12p

From 1 January 2009

Baseline fuel mileage rates
	Rates per mile
Engine capacity	Petrol	Diesel	Gas
Up to 1400cc	10p	11p	7p
1401 - 2000cc	12p	11p	9p
Over 2000cc	17p	14p	12p

HM Revenue & Customs have announced that rates will now be reviewed biannually and generally any changes will take effect on 1 January and 1 July. This area of our site will be updated around the beginning of June and December about one month before any change takes effect.

For employees using their own transport

The approved maximum tax and national insurance free mileage allowances for employees using their own transport for business are as follows:

Flat rate	First 10,000 Miles	Miles over 10,000
Car or van	40p	25p
Motorcycle	24p	24p
Bicycle	20p	20p

Will these rates change?

We understand the HMRC have indicated in a response to a Parliamentary enquiry that it is not intended that these rates will change.

Income Tax and NICs are due when allowances exceed these rates. Employees can claim tax relief on any shortfall.

Rates of up to 5p per mile, per passenger, are also tax and NIC free when paid for the carriage of fellow employees in a car or van on the same business trip.

Green travel guide

For 'green' travel arrangements, bus, cycle and other schemes; click here to visit our green travel guide