HMRC publish the rates of mileage allowances that can be paid to those employees who have driven on business.
Rates for reimbursing business miles for an employee who drives their own car
| Current rates per mile | |
| Up to 10,000 miles | 40p |
| Over 10,000 miles | 25p |
These rates represent the maximum tax free mileage allowances for employees using their own cars for business. Any excess is taxable. If the employee receives less than the statutory rate, tax relief can be claimed on the difference.
Rates for reimbursing business miles for an employee who drives an employer provided car
| Current rates per mile | |||
| Petrol | Diesel | LPG | |
| 1400cc or less | 10p | 10p | 6p |
| 1401cc - 2000cc | 13p | 10p | 8p |
| Over 2000cc | 18p | 13p | 10p |
No dispensation is required if employers pay within these rates.