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Mileage Allowances

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 / Van 40p 25p
Motorcycle 24p 24p
Bicycle 20p 20p
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 on the same business trip.

Fuel-Only Mileage Rates

HMRC advisory mileage rates as at January 2008 for employee private mileage reimbursement or employer reimbursement of business mileage are:
  Petrol Diesel LPG
Up to 1400cc 11p 11p 7p
1401cc - 2000cc 13p 11p 8p
Over 2000cc 19p 14p 11p

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