AMAP Mileage Rates 2026: Claiming Tax-Free Business Mileage

What are AMAP rates?

Approved Mileage Allowance Payments (AMAP) are the maximum mileage rates at which an employer can reimburse employees for using their own vehicle for business travel, without the payment being treated as a taxable benefit.

AMAP rates are set by HMRC and have been unchanged since April 2011. They are not uprated for inflation, which means the real value of the tax-free allowance has eroded significantly over 15 years of rising fuel and motoring costs.

The rates apply to travel in your own vehicle (not a company car). They cover all the costs of business travel including fuel, wear and tear, insurance, and depreciation -- HMRC intends the rates to represent the total cost per mile.

AMAP rates for 2026

The 10,000-mile threshold resets each tax year (6 April to 5 April). Business miles driven in a personal capacity (commuting) do not count. Only genuine business travel qualifies.

Passenger supplement

Where an employee carries a fellow employee as a passenger on the same business journey, the driver can receive an additional 5p per mile per passenger free of tax. This supplement applies only to employees, not to clients, customers, or family members.

For example, a driver carrying two colleagues on a 100-mile business trip can receive up to 45p + 5p + 5p = 55p per mile tax-free for that journey.

What counts as business mileage?

Business mileage includes travel that is wholly and exclusively for business purposes:

• Travelling to a temporary workplace (not your regular place of work).
• Visiting clients, customers, or suppliers.
• Travelling between different work sites.
• Travel to HMRC offices, banks, or suppliers for business purposes.
• Travel by a director to attend board meetings (if not at their regular place of work).

Not business mileage:

• Commuting from home to your regular, permanent workplace.
• Personal errands during a working day.
• Travel to a permanent second workplace (this is a grey area -- HMRC applies the "temporary workplace" test, which looks at whether the workplace is used for a finite or indefinite period).

If your employer pays you the AMAP rate or more

If your employer reimburses you at exactly 45p (first 10,000 miles) and 25p (above), there is:

• No tax liability for you.
• No benefit in kind to report.
• No P87 claim to make.
• The employer gets the mileage cost as a Corporation Tax / income tax deduction.

If your employer pays you more than the AMAP rate, the excess is a taxable benefit in kind. The excess must be reported on your P11D and included in your taxable pay. Income tax and NIC are due on the excess.

If your employer pays you less than the AMAP rate

This is extremely common -- many employers pay 35p or 40p per mile, or have a flat fuel-only rate such as HMRC's Advisory Fuel Rates (AFR) for company cars. If your employer pays you less than 45p per mile (or 25p above 10,000 miles), you can claim Mileage Allowance Relief (MAR) for the shortfall.

MAR is a tax relief that reduces your taxable income by the unclaimed amount. You are not refunded the difference -- you receive tax relief on it. A basic-rate (20%) taxpayer recovers 20% of the gap; a higher-rate (40%) taxpayer recovers 40%.

How to claim MAR

Option 1: Form P87 (for most employees)

If your total expenses claim is under £2,500 per year, you can use the online P87 form at gov.uk. You complete it with your mileage, the rate your employer paid, and HMRC calculates the relief.

P87 can be submitted for the current year and the previous 4 tax years (back to 2022/23 from 2026/27).

Option 2: Self Assessment (SA100)

If you already file a Self Assessment return, include the MAR claim on the employment pages (box 20 or equivalent). If your total employment expenses including MAR exceed £2,500, you must use Self Assessment rather than P87.

Worked example: MAR claim

Facts:

• Employee uses own car for business travel.
• Business miles in 2026/27: 12,000 miles.
• Employer pays 30p per mile throughout.
• Tax rate: 20% basic rate.

AMAP calculation:

• First 10,000 miles at 45p: £4,500
• Next 2,000 miles at 25p: £500
• Total AMAP entitlement: £5,000

Employer payment:

• 12,000 miles at 30p: £3,600

MAR claim:

• Shortfall: £5,000 - £3,600 = £1,400
• Tax relief at 20%: £1,400 x 20% = £280 tax saving

The employee does not receive £1,400 in cash -- they receive a £280 reduction in their tax bill (or a £280 refund if their employer has over-collected PAYE for the year).

Record-keeping requirements

HMRC requires contemporaneous records for any mileage claim. "Contemporaneous" means recorded at the time of travel, not reconstructed months later.

A compliant mileage log must include for each journey:

• Date of travel.
• Start location (address or description sufficient to locate it).
• End location (same).
• Business purpose (e.g. "client meeting at [client name], [town]").
• Miles driven on that journey.
• Cumulative annual total (to correctly apply the 10,000-mile threshold).

Acceptable formats include:

• A dedicated mileage log book.
• A spreadsheet.
• A mileage tracking app (e.g. MileIQ, Driversnote, TripLog).

HMRC has the power to disallow a claim entirely if adequate records cannot be produced during an enquiry.

Self-employed mileage

Self-employed sole traders and partners have two options for claiming business mileage:

Option 1: Simplified expenses (AMAP rates)

Apply the same 45p/25p AMAP rates (and 24p motorbike / 20p bicycle). This is the "simplified expenses" method. It is simple, requires only a mileage log, and no calculation of actual vehicle costs. Once you choose this method for a vehicle, you must use it for the life of that vehicle in your business.

Option 2: Actual costs

Claim the actual proportion of vehicle running costs (fuel, insurance, servicing, MOT, road tax, depreciation/capital allowances) that relate to business use. Requires detailed records of all vehicle costs and a log to calculate the business use percentage. More complex but potentially more beneficial for high-mileage, high-cost vehicles.

You cannot use both methods for the same vehicle. Limited companies cannot use the simplified AMAP rates for company-owned vehicles -- the actual cost method (with capital allowances) must be used.

Advisory Fuel Rates (AFR) -- not the same as AMAP

There is frequent confusion between AMAP and HMRC's Advisory Fuel Rates (AFR). They are different:

• AMAP applies to employees using their own vehicle. It covers the total cost of motoring.
• AFR applies to company car drivers claiming the fuel-only cost of business travel (where the employer provides the car but wants to reimburse fuel). AFR rates change quarterly and depend on engine size and fuel type.

AFR rates are typically much lower than AMAP because they cover only the fuel element, not total vehicle costs. A company car driver cannot use AMAP rates -- they use AFR.

Sources

• HMRC: Approved mileage rates and allowances
• HMRC: Mileage Allowance Relief -- claim using P87
• HMRC: Simplified expenses for self-employed
• HMRC: Advisory fuel rates