Mileage Allowance Payments

What are Mileage Allowance Payments (MAPs)?

Mileage Allowance Payments (MAPs) are paid to employees to reimburse them for using a personal vehicle for business travel. The reimbursement might be paid as a lump sum, a fixed rate per mile, or a reimbursement for the actual expenditure incurred. Reimbursing employee business travel is fully at the discretion of the employer.

What are Approved Mileage Allowance Payments (AMAPs)?

Approved Mileage Allowance Payments (AMAPs) are MAPs paid up to a certain amount, set by the government, that are automatically not taxable, as set out in sections 229 to 236 of the Income Tax (Earnings and Pensions) Act (ITEPA) 2003. This non-taxable amount varies depending on the vehicle type and total mileage. For example, in 2026/27, those using their own car for work purposes and drive less than 10,000 business miles in a tax year can be reimbursed 55p per business mile, tax free.

Employers can set whatever (if any) level of mileage reimbursement they want. However, any MAPs exceeding the AMAP rate may be liable for tax.

The Treasury can change AMAPs through regulations. While ITEPA 2003 only creates an income tax exemption, a similar tax exemption exists for National Insurance Contributions (NICs) under the Social Security (Contributions) (Amendments) Regulations 2002. AMAP rates apply to electric vehicles as well.

AMAPs rates were introduced to increase simplicity in businesses’ administration. This is because any mileage reimbursement within the AMAP limit does not have to be declared to HM Revenue and Customs (HMRC) and is not liable for income tax or NICs.

How are AMAP rates calculated?

There is no specific calculation involved in setting out AMAPs rates. The government has said the rates are a policy decision taken after considering issues including the cost of motoring (such as fuel, insurance, etc), the cost to the public purse of changing the rate, and the overall fiscal position.

What is the Mileage Allowance Relief

Where an employer offers a mileage reimbursement below the AMAP level, or no reimbursement at all, individuals can apply for Mileage Allowance Relief from HMRC. This provides tax relief for the difference between what the employee receives and the AMAP level.

How have AMAP rates changed?

The current AMAPs rates are shown in the table below:

Approved mileage allowance payment rates

(pence per mile per tax year)

Vehicle

First 10,000 business miles

Each mile over 10,000

Cars and vans

55p

25p

Motorcycles

24p

24p

Bicycles

20p

20p

Source: UK Government, Tax relief for your job expenses – vehicles you use for work, accessed on 26 May 2026

AMAP rates have only changed twice since their introduction. In 2011/12, the Coalition government increased the rate for cars and vans for the first 10,000 miles from 40p to 45p per mile (via The Approved Mileage Allowance Payments (Rates) Regulations 2011).

In May 2026, the Labour government increased AMAP rates on cars and vans for the first 10,000 of business mileage, from 45p to 55p per mile. Rates for motorcycles and bicycles, as well as those for cars and vans for mileage exceeding 10,000 miles, has remained unchanged.

The increase implemented by the Labour government is going to be retroactive, to be applied from the beginning of the 2026/27 tax year (6 April).