Claiming Mileage as Self-Employed UK — Rates, Rules, and How to Claim
HMRC mileage rates for self-employed workers. How to claim mileage, the two methods compared, record-keeping requirements, and common mistakes to avoid.
·4 min read
If you drive for business as a self-employed worker, you could be claiming hundreds or even thousands of pounds in tax deductions. Here is how mileage claims work, which method to use, and how to keep HMRC-compliant records.
The Two Methods
You have two options for claiming vehicle costs as a self-employed person. You must choose one method per vehicle and cannot switch back and forth.
Method 1: Simplified Mileage (Flat Rate)
Vehicle
First 10,000 miles
After 10,000 miles
Car or van
45p per mile
25p per mile
Motorbike
24p per mile
24p per mile
Bicycle
20p per mile
20p per mile
These rates are designed to cover all running costs: fuel, insurance, road tax, MOT, servicing, repairs, and depreciation. You cannot claim any of these costs separately on top of the mileage rate.
Method 2: Actual Costs
Claim the actual costs of running your vehicle, proportioned to business use.
Claimable costs
Examples
Fuel
Petrol, diesel, electricity
Insurance
Annual premium
Road tax
Annual cost
MOT
Annual cost
Servicing and repairs
All maintenance
Breakdown cover
Annual membership
Lease or hire payments
Monthly cost
Depreciation / capital allowances
For purchased vehicles
Parking and tolls
Business journeys only
You then calculate the business use percentage based on your mileage:
Total annual mileage
Business miles
Business use %
Claimable
12,000
8,000
67%
67% of total costs
15,000
5,000
33%
33% of total costs
Which Method Is Better?
Simplified mileage is better if
Actual costs are better if
You drive a cheap, reliable car
You drive an expensive car with high running costs
Your annual costs are low
Your fuel and maintenance costs are high
You want simple record keeping
You are comfortable tracking all receipts
You drive fewer than 10,000 business miles
You drive many business miles in an expensive vehicle
You are unsure or just starting out
You have a leased or financed vehicle
Comparison Example
Simplified mileage
Actual costs
Business miles
8,000
8,000
Total miles
12,000
12,000
Business %
—
67%
Mileage claim
8,000 × 45p = £3,600
—
Total car costs
—
£5,000
Actual costs claim
—
£5,000 × 67% = £3,350
Better option
Simplified (£3,600)
—
In this example, simplified mileage wins. But if total car costs were £7,000 (for example, a newer or more expensive vehicle), actual costs would be £4,690, making it the better choice.
What Counts as a Business Journey?
Business travel (claimable)
Not business travel (not claimable)
Travelling to a client’s premises
Commuting from home to a regular workplace
Visiting suppliers or wholesalers
Personal trips
Travelling between work sites
Travelling to and from your permanent office
Going to the bank for business
Attending business meetings
Travelling to training courses
Collecting business supplies
The Home Office Rule
If your home is your main place of work (and you are genuinely based there, not just working from home occasionally), then journeys from home to client sites and temporary workplaces are business travel.
Record Keeping
What to Record for Each Journey
Information
Why
Date
When the journey was made
Start and end location
Where you travelled from and to
Purpose
Why it was a business journey
Miles
Distance travelled
Running total
Cumulative business miles for the year
How to Track
Method
Pros
Cons
Mileage tracking app (e.g. MileIQ, Driversnote)
Automatic GPS tracking, easy to export
Monthly subscription cost
Spreadsheet
Free, customisable
Manual entry required
Notebook
Simple, no tech needed
Easy to forget, harder to total up
Google Maps history
Can verify distances after the fact
Not a formal mileage log
Keep records for at least 5 years after the 31 January Self Assessment deadline for that tax year.
Claiming on Your Tax Return
Step
Action
1
Total up your business miles for the tax year
2
Calculate: first 10,000 miles × 45p + remaining miles × 25p
3
Enter the total in the vehicle expenses section of your Self Assessment
4
If using actual costs, enter the business proportion of your total costs instead
Example Claim (Simplified Mileage)
Detail
Amount
Business miles in the year
14,000
First 10,000 × 45p
£4,500
Next 4,000 × 25p
£1,000
Total mileage claim
£5,500
Tax saving (basic rate)
£1,100
Tax saving (higher rate)
£2,200
Common Mistakes
Mistake
What to do instead
Claiming commuting as business travel
Only claim genuine business journeys
Not keeping a mileage log
Record every business journey with date, purpose, and miles
Claiming mileage AND actual costs
Choose one method per vehicle
Forgetting to claim
Many self-employed people under-claim — track everything
Switching methods year to year
Once you use actual costs for a vehicle, you can switch to simplified only when you change vehicle
Claiming 45p for all miles
Only the first 10,000 business miles are at 45p — the rest are at 25p
Parking, Tolls, and Congestion Charges
Cost
Claimable?
Business parking
Yes (both methods)
Business tolls
Yes (both methods)
Congestion charge (business journey)
Yes (both methods)
Parking fines
No
Speeding fines
No
Home parking costs
No
Parking and tolls are claimable on top of the simplified mileage rate — they are separate costs.