How to Claim Business Mileage as a Self-Employed Worker

If you use your own car, van, motorcycle or bike for work, HMRC's simplified mileage rates let you claim a flat amount per mile rather than tracking every fuel receipt and repair bill. For most self-employed people, this is both simpler and, over a full tax year, often more valuable than expected.

How the flat rates work

Using HMRC's simplified expenses mileage rates, sole traders and partners can claim 45p per mile for the first 10,000 business miles in a car or van each tax year, dropping to 25p per mile after that. Motorcycles are claimed at 24p per mile with no mileage tiering, and bicycles at 20p per mile.

These rates are designed to cover fuel, insurance, servicing, depreciation and other running costs combined — you can't claim mileage at these rates and then separately claim for fuel or repairs on the same vehicle. It's one method or the other, and once you choose simplified mileage for a vehicle, you generally need to stick with it for as long as you use that vehicle in the business.

What counts as business mileage

Travel between your home and a regular, permanent workplace doesn't count — this is treated as ordinary commuting, just as it would be for an employee. What does count: travel to temporary work locations, client visits, trips to suppliers, and journeys between different work sites during the day. If you work from home as your base and travel out to jobs or clients, most of that outbound travel is likely claimable.

Checklist: claiming mileage correctly

1. Keep a mileage log for every business journey — date, start and end location, purpose, and miles driven
2. Separate business mileage from personal and commuting mileage clearly in your records
3. Choose simplified mileage rates or actual costs for each vehicle — not both, and decide early since switching later is restricted
4. Apply the correct rate: 45p/mile for the first 10,000 business miles annually, 25p/mile after that (cars and vans)
5. Total your mileage claim at the end of the tax year and include it as an expense on your Self Assessment return
6. Keep records for at least five years after the 31 January submission deadline, as HMRC can request evidence
7. If you use more than one vehicle, keep separate logs — the 10,000-mile higher rate threshold applies per tax year across your total business mileage, not per vehicle
8. Don't forget passenger mileage — you can claim an extra 5p per mile per passenger if they're also travelling for business purposes in your vehicle

A simple example

If you drive 8,000 business miles in a tax year, claiming simplified mileage gives you 8,000 × 45p = £3,600 as an allowable expense, reducing your taxable profit by that amount. On 12,000 business miles, it's (10,000 × 45p) + (2,000 × 25p) = £4,500 + £500 = £5,000. This is deducted from your profit before Income Tax and Class 4 National Insurance are calculated — it isn't a direct cash refund, but it does lower your tax bill.

International comparison

The US equivalent is the IRS standard mileage rate for business use, set annually and historically in a broadly similar range per mile once currency is converted, though the US rate is a single flat figure with no tiering by annual mileage, unlike the UK's two-tier structure. Australia's equivalent, the ATO cents-per-kilometre method, works similarly to the UK's simplified system — a flat rate per kilometre capped at 5,000 business kilometres a year, beyond which the logbook method (tracking actual costs) is required instead.

Key Numbers

• 45p — rate per mile for the first 10,000 business miles (car or van) in a tax year
• 25p — rate per mile after the first 10,000 business miles
• 24p — flat rate per mile for motorcycles, no tiering
• 20p — flat rate per mile for bicycles

Sources

• GOV.UK: Simplified expenses if you're self-employed — vehicles
• GOV.UK: Self-employed expenses you can claim
• HMRC: Self Assessment guidance

Educational content only — not financial advice.