Mileage Allowance Calculator Self Employed: Claim Every Mile
Most self-employed UK tradespeople underclaim mileage by hundreds of pounds a year. Here is exactly how to calculate, record, and claim every mile you are owed.
Most self-employed tradespeople leave £400 to £800 in unclaimed mileage relief on the table every single tax year. Not because they drove fewer miles, but because nobody ever showed them how the mileage allowance calculator actually works for the self-employed in the UK.
- HMRC's Approved Mileage Allowance Payments (AMAPs) let you claim 45p per mile for the first 10,000 business miles, then 25p per mile after that.
- You cannot claim AMAPs if you have already claimed capital allowances or actual running costs on the same vehicle.
- A sole trader doing 12,000 business miles a year is entitled to £4,750 in mileage relief, reducing their taxable profit by exactly that amount.
- From April 2026, MTD for Income Tax requires quarterly submissions, making accurate mileage records more important than ever.
- A simple mileage log, maintained consistently, is the difference between a legitimate claim and one HMRC can disallow entirely.
If you drive a van to job sites, visit clients, or travel between work locations as a sole trader or self-employed landlord, you are entitled to claim mileage as a business expense. HMRC even publishes the rates. Yet survey after survey of small business owners finds the same thing: the claim is either missed entirely, calculated incorrectly, or challenged because the records do not hold up. This post cuts through the confusion.
- Approved Mileage Allowance Payments (AMAPs)
- HMRC's flat-rate scheme allowing self-employed individuals to claim a set amount per business mile driven, instead of calculating actual vehicle running costs. The current rates are 45p per mile for the first 10,000 miles in a tax year and 25p per mile thereafter. Using AMAPs means you cannot also claim fuel, insurance, or depreciation separately on the same vehicle.
The Mileage Rates HMRC Actually Publishes
HMRC sets the Approved Mileage Allowance Payment rates annually. For the 2024/25 and 2025/26 tax years, the rates for cars and vans are:
- First 10,000 business miles: 45p per mile
- Over 10,000 business miles: 25p per mile
- Motorcycles (any distance): 24p per mile
- Bicycles (any distance): 20p per mile
These figures have not changed since 2011, which is its own quiet scandal given that fuel costs have risen sharply since then. But they remain the rates, and they remain claimable.
For a sole trader turning over £60,000 a year and paying income tax at the basic rate of 20 percent, a £4,750 mileage deduction saves approximately £950 in tax. At the higher rate of 40 percent, that rises to £1,900. These are not rounding errors.
How to Use a Mileage Allowance Calculator: Self-Employed UK Edition
The calculation itself is straightforward. Multiply your total business miles by the applicable rate:
Example: Dave, a self-employed electrician in the West Midlands
Dave drives 14,000 miles in the 2025/26 tax year visiting job sites and collecting materials. His calculation looks like this:
- First 10,000 miles × 45p = £4,500
- Remaining 4,000 miles × 25p = £1,000
- Total mileage claim: £5,500
That £5,500 comes straight off Dave's taxable profit. If his profit before the mileage deduction was £58,000, HMRC now taxes him on £52,500. At basic rate, that is a £1,100 tax saving. At higher rate, it is £2,200.
The mileage allowance calculator principle is simple. What trips people up is determining which miles actually count.
Which Miles Count as Business Miles?
This is where sole traders routinely get it wrong, either by overclaiming (and risking HMRC scrutiny) or underclaiming (and handing money back for no reason).
Miles you CAN claim:
- Travel from your home to a temporary workplace (a job site you visit for fewer than 24 months)
- Travel between job sites on the same day
- Trips to collect materials or tools
- Visits to clients, customers, or suppliers
- Travel to training courses directly related to your trade
- Trips to your accountant or business bank
Miles you CANNOT claim:
- Ordinary commuting from home to a permanent place of work
- Personal journeys (school runs, supermarket trips, holidays)
- Travel from home to your own office or workshop if that is your main base
The permanent versus temporary workplace distinction is where HMRC investigations most commonly catch sole traders. If you work exclusively for one contractor at one site for over 24 months, HMRC may reclassify that site as a permanent workplace, making your daily travel non-deductible. This is particularly relevant if you work in construction; you can read more about those specific complications in MTD for Construction Workers: CIS and the Double Reporting Trap.
AMAPs vs. Actual Costs: Which Is Better?
This is the decision every self-employed driver faces at the start. You must choose one method per vehicle and stick with it. You cannot switch midway through a vehicle's life once you have claimed capital allowances or actual running costs.
Approved Mileage Allowance Payments (AMAPs):
- Simple flat rate per mile
- No need to track fuel receipts, insurance, MOT, or servicing separately
- Works best for lower-mileage drivers or those with older, cheaper vehicles
- You can start claiming from the first mile on a new vehicle
Actual costs method:
- Claim the business proportion of all real running costs: fuel, insurance, road tax, servicing, MOT, tyre replacement
- Also claim capital allowances on the vehicle purchase price
- More admin-intensive but potentially more valuable for high-mileage drivers with expensive vehicles
- Requires detailed records of all expenditure
For most sole traders driving a van or car with moderate annual mileage, AMAPs win on simplicity. A plumber doing 8,000 business miles a year claiming 45p per mile gets £3,600 without touching a single fuel receipt. That same plumber tracking actual costs might claim more, but they need meticulous records covering every expense for potentially years. Given that HMRC can open an enquiry going back up to four years (or six if they suspect carelessness), the admin burden of the actual costs method is substantial.
If you are unsure which method suits your situation, the Sole Trader Tax for Personal Trainers: The Expenses HMRC Misses post covers a similar dilemma for a different trade, and the logic applies broadly.
The Mileage Log: What HMRC Actually Expects
HMRC does not prescribe a specific format for a mileage log. What it does require is that your records are accurate, contemporaneous (recorded at the time, not reconstructed months later), and sufficient to support your claim.
A compliant mileage log should record, for each trip:
- The date
- Start and end locations (addresses, not just "site")
- Purpose of the journey ("client meeting at 14 High Street, client name" beats "work")
- Odometer reading at start and end, or total miles for the trip
- Running total of business miles for the tax year
A handwritten notebook works. A spreadsheet works. A dedicated mileage tracking app works. What does not work is trying to reconstruct twelve months of driving from memory in January, which is what HMRC suspects when they see suspiciously round numbers.
From April 2026, Making Tax Digital for Income Tax (MTD ITSA) requires sole traders earning above £50,000 to submit quarterly updates to HMRC. Mileage figures will flow into those quarterly submissions, which means inaccurate logs become an immediate problem rather than a year-end issue. If you have not yet worked out what that transition means for your record-keeping, How to Get Started With MTD ITSA Before April 2026 is worth reading before the deadline arrives.
Passengers: The Forgotten Extra Claim
If you carry an employee as a passenger on a business journey, you can claim an additional 5p per mile per passenger on top of your standard mileage rate. Most sole traders have no employees, so this rarely applies, but if you do take on a part-time assistant or labourer whom you drive to sites, the extra claim is legitimate and consistently overlooked.
Motorcycles and Bicycles
The AMAP rates extend beyond cars and vans. Motorcycle riders can claim 24p per mile for all business miles (no two-tier system). Cyclists can claim 20p per mile. Given the rising number of self-employed couriers, delivery riders, and tradespeople using cargo bikes in urban areas, these rates are worth knowing.
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The MTD Angle: Mileage Records Under Quarterly Reporting
From April 2026, sole traders and landlords with income above £50,000 must comply with MTD for Income Tax. Those earning between £30,000 and £50,000 follow from April 2027. Under MTD, you submit quarterly updates covering your income and expenses, followed by a final declaration at year end.
Mileage relief sits in your expenses. Under the current annual Self Assessment system, you can wait until January and tot up a year's mileage in one session (legally, if your log is accurate; chaotically, if you have been winging it). Under MTD, you are categorising and submitting expenses four times a year.
This is not necessarily a burden if your records are in order. It can actually be useful: you will spot mid-year if your mileage claim is running low and remind yourself to log trips more carefully. But if your mileage log is a mess, quarterly submissions will expose that much faster than annual filing ever did.
For a wider view of how quarterly reporting changes expense management, MTD Quarterly Update Mistakes That Cost Sole Traders Real Money covers the most common pitfalls in detail.
What HMRC Investigates and Why
HMRC's Connect system cross-references tax returns against third-party data, including fuel card records, toll payments, and in some cases vehicle licensing data. Mileage claims that are inconsistent with the nature of the business (a sole trader claiming 20,000 miles a year while working exclusively in one building, for instance) flag easily.
The most common mileage errors HMRC pursues:
- No mileage log at all. If HMRC asks for evidence and you have none, the claim is disallowed. You then owe the tax plus interest and potentially a penalty.
- Claiming home-to-permanent-workplace commuting. This is ordinary commuting and not allowable, however unfair that feels.
- Round number logs. "500 miles per month" for twelve months straight looks reconstructed rather than recorded.
- Overclaiming the 45p rate beyond 10,000 miles. A straightforward calculation error, but HMRC spot-checking returns will catch it.
If you have received a compliance check related to mileage or any other expense, How to Appeal an HMRC Penalty and Actually Win is directly relevant.
A Practical System for Sole Traders Who Hate Admin
The best mileage log is one you will actually maintain. Here are three approaches, in order of simplicity:
Option 1: Smartphone app with GPS tracking. Apps record trips automatically using GPS. You tag each trip as business or personal, add a purpose, and export a report at quarter-end. Minimal manual input, strong audit trail.
Option 2: Notes app on your phone. After each business trip, voice-to-text a quick note: "14 March, 22 miles, job site at 47 Birch Road, boiler installation, client name." Review and tidy weekly. Costs nothing.
Option 3: Notebook in the van. Date, start, end, miles, purpose. Old-fashioned but HMRC-compliant. The key is doing it immediately, not at the end of the day when three jobs blur together.
Whatever system you choose, keep it consistent. HMRC is not looking for perfection; they are looking for plausibility and evidence that you actually recorded trips rather than invented them later.
Run the Numbers for Your Own Situation
A rough benchmark: if you are a self-employed tradesperson working five days a week and typically driving 30 miles round trip to job sites, that is roughly 7,500 business miles a year at 45p, equal to a £3,375 deduction. At basic rate tax, that is £675 back. At higher rate, £1,350. If you are currently filing annual Self Assessment and not claiming mileage, that money has been sitting unclaimed.
For those earning above £50,000 who are approaching the MTD threshold, it is also worth checking whether your total income actually exceeds the limit once proper mileage deductions are applied. Deductions reduce your profit figure, which is what the MTD threshold tests. Getting your mileage claim right could, in some cases, affect whether you are required to comply with MTD in the earliest phase.
You can cross-reference your overall tax position using the TapTax tax calculator at taptax.co.uk/tax-calculator to see the actual impact of your mileage claim on your net tax liability.
The Bottom Line
Back to where we started: most self-employed UK tradespeople leave hundreds of pounds in mileage relief unclaimed every year. The mileage allowance calculator for self-employed individuals is not complex. HMRC has published the rates. The scheme exists precisely to make vehicle expenses manageable for sole traders without an accountant on retainer. The only thing standing between you and a legitimate claim is a mileage log you actually maintain.
Start one today. Record last week's trips from memory if you must, clearly labelled as approximate and backdated. Then keep it current from this point forward. When your first MTD quarterly submission arrives, you will have something real to put in it.
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