Business Mileage Rate Rises to 55p

HMRC has increased the approved mileage rate for employees using their own vehicles for business journeys.

For the 2026/27 tax year, the approved rate is now 55p per mile for the first 10,000 business miles, while the rate above 10,000 miles remains 25p.

Importantly, the change has been backdated to 6 April 2026.

Employers who used the previous rate may need to review earlier payroll calculations. HMRC says that where tax or National Insurance was deducted based on the old rate, payroll corrections may be required so any overpayments can be refunded.