Mileage Claim Calculator: Stop Leaving Cash on the Road

Most sole traders who drive for work are quietly handing money back to HMRC every single year. Not because they owe it. Because they never claimed it.

If you are a plumber, electrician, handyman, or any sole trader who spends half your working life driving between jobs, mileage relief is arguably the most underclaimed tax deduction available to you. Yet a 2023 survey by accounting software firm FreeAgent found that 41% of self-employed people either never tracked their business mileage or tracked it inconsistently. At 45p per mile, every 100 miles you forget to log costs you £45 in unclaimed relief. Over a year, that is real money left on the dashboard.

This post explains exactly how a mileage claim calculator works for sole traders, what the HMRC rules actually say (not what rumour says they say), and why getting this right matters even more once Making Tax Digital for Income Tax lands in April 2026.

What a Mileage Claim Calculator Actually Does

A mileage claim calculator is not complicated. At its core, it multiplies your business miles by the HMRC AMAP rate and tells you your allowable deduction. The maths is straightforward:

• First 10,000 miles: miles × £0.45
• Miles above 10,000: miles × £0.25

So if you drive 12,000 business miles in a tax year, your calculation looks like this:

• 10,000 × £0.45 = £4,500
• 2,000 × £0.25 = £500
• Total mileage deduction: £5,000

That £5,000 comes off your taxable profit. If you are a basic-rate taxpayer, that is a saving of £1,000 in Income Tax plus £690 in Class 4 National Insurance contributions. If you are nudging the higher rate, the combined saving is closer to £2,100. A mileage claim calculator worth using will show you the tax saving in pounds, not just the raw mileage figure, because that is the number that actually matters.

The HMRC Rules You Actually Need to Know

Business miles versus commuting miles

HMRC is very clear on one point: travel between your home and a permanent workplace is not a business mile. It is commuting, and it is not deductible. For most sole traders, this is largely irrelevant because you do not have a permanent employer workplace. Your travel from home to a client's site, a job, or a supplier counts as business travel.

However, if you have a fixed office you rent or work from regularly, journeys from home to that office are commuting, not business travel. The rule HMRC uses is the concept of a "temporary workplace": any location you attend for a limited duration or for a specific purpose qualifies. Most client sites and job locations will meet this test easily.

The method lock-in problem

This is the rule that catches sole traders out more than any other. Once you start claiming mileage using the AMAP flat rate on a particular vehicle, you must continue to use that method for the life of that vehicle. You cannot switch to claiming actual costs (fuel, insurance, servicing, depreciation via capital allowances) mid-way through ownership.

Conversely, if you buy a new van and initially claim capital allowances in year one, you cannot switch to the AMAP rate for that vehicle later.

The practical implication: before you decide which method to use on a new vehicle, run the numbers. For a high-mileage tradesperson in a relatively inexpensive van, AMAP often wins because the 45p rate is generous relative to actual running costs. For a sole trader driving a large, expensive vehicle with lower annual mileage, actual costs may be higher.

Motorcycles and bicycles

The AMAP rates are different for other vehicles. Motorcycles are 24p per mile (no threshold reduction). Bicycles are 20p per mile. If you cycle between jobs and never claim it, that is another deduction you are missing.

Passengers

If you carry employees (not clients) as passengers on business journeys, you can claim an additional 5p per mile per passenger on top of the standard AMAP rate. This applies to employees only, not subcontractors or clients.

Why Your Log Matters More Than the Rate

Knowing the AMAP rate is the easy part. The part that causes sole traders grief during HMRC compliance checks is the mileage log itself.

HMRC does not specify an exact format, but they expect a contemporaneous record, meaning you should be logging journeys as they happen, not reconstructing a year's worth of driving from memory in January. A compliant mileage log should include:

• Date of each journey
• Start and end location (postcodes are ideal)
• Purpose of the journey ("job at client X", "collect materials from supplier Y")
• Miles driven
• Running total for the year

HMRC can open an enquiry into any tax return up to 12 months after the filing deadline, or up to six years if they suspect careless behaviour. A spreadsheet with 500 identical entries all logged on the same day is not going to hold up.

The simplest approach for a tradesperson is to log mileage from their phone at the start and end of each job, or use an app that tracks GPS and exports a log automatically. If you are already using an MTD-compliant app like TapTax, your mileage records and quarterly submissions live in the same place, which removes the admin headache of keeping separate systems.

The MTD Angle Nobody Is Talking About

From April 2026, sole traders and landlords with income above £50,000 must comply with Making Tax Digital for Income Tax. The £30,000 threshold follows in April 2027.

Under MTD, you will submit quarterly updates to HMRC showing your income and expenses, then an end-of-period statement and final declaration annually. That is five submissions per year instead of one.

Here is why mileage logging becomes even more critical under MTD: your quarterly expense figures need to be accurate enough to be defensible, because HMRC's systems will be receiving them in near real-time rather than twelve months after the fact. If your Q1 submission shows £800 in mileage costs and your Q3 submission shows zero, that inconsistency is visible to HMRC's compliance algorithms immediately.

Sole traders who currently wing their mileage at year-end will find that approach increasingly untenable. The honest answer is that MTD is not just a filing change; it is a record-keeping regime change. Your mileage log needs to be live, not retrospective.

For a deeper look at how MTD changes the cash flow picture for self-employed people, the post on MTD for Self Employed Project Managers: The Cash Flow Trap covers the quarterly mechanics in detail.

A Real-World Calculation: The Electrician Who Nearly Missed £1,800

Consider a self-employed electrician based in the East Midlands, turning over £62,000 a year. He drives a Transit van he bought privately and has always used the AMAP method. In a typical year he drives roughly 14,000 miles, of which he estimates 10,000 are business-related.

Except, when he actually logs his journeys for a month and extrapolates, the true figure is closer to 13,500 business miles. He has been under-claiming by 3,500 miles every year.

At the AMAP rates:

• Actual claim: 10,000 × £0.45 + 3,500 × £0.25 = £4,500 + £875 = £5,375
• What he was claiming: 10,000 × £0.45 = £4,500
• Unclaimed deduction: £875 per year
• Tax and NI saving missed (basic rate + Class 4): approximately £303 per year

That is £303 handed back to HMRC every year for no reason other than a rough estimate. Over five years, that is £1,515. And that is on the conservative side: if his income creeps above £50,270 and some of those miles attract higher-rate relief, the missed saving is larger still.

The fix took him twenty minutes: download a mileage tracking app, connect it to his TapTax account, and let it log automatically.

Mileage Versus Actual Costs: When to Do the Maths

For most sole traders driving modest vehicles with high annual business mileage, the AMAP flat rate beats actual costs. But it is worth knowing when actual costs might win.

Actual costs include:

• Fuel (business proportion only)
• Insurance (business proportion only)
• Servicing and repairs (business proportion only)
• Capital allowances on the vehicle purchase price (business proportion only)

To claim actual costs, you calculate the percentage of total annual mileage that is business mileage and apply that percentage to all running costs. You also claim capital allowances on the purchase price.

Where actual costs tend to win: low annual mileage on an expensive vehicle, especially if you bought the vehicle new and can claim the full Annual Investment Allowance on the business proportion.

Where AMAP tends to win: high annual mileage on a mid-range vehicle where the 45p rate exceeds your actual cost per mile.

The average cost to run a petrol car in the UK in 2024 was estimated at around 30-35p per mile including depreciation (RAC, 2024). At 45p, the AMAP rate is generous by comparison, which is why most sole traders are better off using it.

If you are unsure which method suits your situation, the Self Employed Tax Estimator 2026 post walks through how to model your overall tax position before committing to an approach.

How to Use a Mileage Claim Calculator Step by Step

1. Separate business and private miles. Go through your calendar or job records for the past three months and count every journey made for work purposes. Do not include home-to-office commuting.

2. Annualise your figure. Multiply your quarterly total by four to get an annual estimate, or log all twelve months if you have the records.

3. Apply the AMAP rates. If total business miles are under 10,000, multiply by £0.45. If over, apply £0.45 to the first 10,000 and £0.25 to the remainder.

4. Calculate the tax saving. Multiply the deduction by your marginal rate. Basic rate (20%) plus Class 4 NI (9%) gives an effective relief rate of approximately 29% on profits between £12,570 and £50,270.

5. Confirm your method. If this is a new vehicle, decide now whether to use AMAP or actual costs. If you have been using the vehicle for previous tax years, you are locked into whichever method you used first.

6. Set up a logging system. A spreadsheet, a dedicated mileage app, or an integrated MTD tool. Whatever you will actually use consistently.

The Honest Summary

You started reading this post because you probably suspected you were under-claiming on mileage. That suspicion is almost certainly correct.

The AMAP mileage claim calculator is not complicated; the rate is 45p per mile up to 10,000 miles, 25p after that. The hard part is building the habit of logging every journey rather than guessing at year-end. With MTD for Income Tax arriving for higher-earning sole traders in April 2026, the window for retrospective guesswork is closing. HMRC will be receiving your expense data quarterly, and a well-kept mileage log is the difference between a clean submission and a compliance headache.

The single most useful thing you can do today: open your calendar, count the last month's business journeys, multiply by the distance, then multiply by £0.45. That is the monthly mileage relief you have been earning. Annualise it and compare it to what you actually claimed last year. If there is a gap, you now know what it costs you.

TapTax makes mileage tracking part of your MTD workflow rather than a separate admin task. If you are approaching the £50,000 threshold and want your quarterly submissions to be accurate from day one, it is worth setting up before April 2026 rather than scrambling afterwards.