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Discover the changes to Approved Mileage Allowance Payments (AMAPs), Mileage Allowance Relief (MAR) and Self-Employed Mileage
As part of the Great British Summer Savings scheme, the Chancellor announced on 21 May 2026 an increase in the rate of business mileage claims.
These changes apply to Approved Mileage Allowance Payments (AMAPs), Mileage Allowance Relief (MAR), and self-employed mileage claims from 6 April 2026.
Increases to AMAPs, MAR and mileage rates for self-employed individuals will apply retrospectively from 6 April 2026, covering the 2026/27 tax year.
Updated mileage rates
From 6 April 2026, the revised rates will be:
- 55p per mile for the first 10,000 business miles in a tax year (previously 45p per mile)
- 25p per mile for any mileage above 10,000 miles (no change to this rate).
These changes apply to employees using their own vehicles for business travel, as well as individuals claiming relief through Mileage Allowance Relief (MAR) and self-employed taxpayers calculating allowable business motoring costs.
Impact on employers
Employers may wish to review and increase the mileage reimbursement paid to employees to ensure it aligns with the updated AMAP rates.
Where employers have already reimbursed mileage using the previous rates and applied income tax and national insurance contributions (on the excess amount), they may need to revisit payroll calculations for April and May. This may involve re-running payroll to reflect the revised allowances and ensure employees are correctly compensated under the updated rules.
Employee claims for mileage relief
Employees who receive mileage reimbursement below the revised AMAP rates may be eligible to claim tax relief for the difference as a job expense.
The relevant tax relief claim forms are currently being updated to reflect the new mileage rates.
Self-employed taxpayers
Self-employed individuals will apply the updated mileage rates when completing their 2026/27 self assessment tax return. The relevant deadlines are:
- 31 October 2027 for paper returns
- 31 January 2028 for online submissions.
These rates should be used when calculating allowable business expenses for vehicle use in the 2026/27 tax year.
The Business Income Manual BIM75005 relating to expenditure on motor vehicles was updated on 21 May 2026 and it reflects the revised mileage treatment and associated computational rules.