UK Business Mileage Claims – What You Can Deduct in 2025
Understanding how to make UK business mileage claims correctly is essential for sole traders and company directors looking to reduce their tax liability in 2025. HMRC allows you to claim for business-related travel using a fixed mileage rate, but only when specific conditions are met.
This guide explains what counts as business mileage, how much you can claim, and the rules you must follow to stay compliant.
What Counts as Business Mileage?
Business mileage is travel in your personal vehicle for work-related purposes. It includes:
- Travelling to meet clients or suppliers
- Attending off-site meetings, training, or events
- Journeys between different workplaces (for the same job)
Does not include:
- Commuting from home to your regular place of work
- Personal journeys
Approved Mileage Rates (2025)
HMRC sets approved mileage rates, which you can use to calculate allowable business travel expenses:
| Vehicle Type | First 10,000 Miles | Miles Over 10,000 |
|---|---|---|
| Car/Van | 45p per mile | 25p per mile |
| Motorcycle | 24p per mile | 24p per mile |
| Bicycle | 20p per mile | 20p per mile |
These rates are designed to cover fuel, insurance, wear and tear, and other running costs.
Claiming for Business Mileage: Sole Traders vs Limited Companies
Sole Traders
You can:
- Use simplified expenses (flat mileage rates)
- OR claim actual vehicle running costs (insurance, repairs, fuel, etc.) if you use the vehicle solely for business
You must choose one method per vehicle per year.
Limited Company Directors
- Use your personal car for business and claim mileage at HMRC’s approved rate
- Submit an expense claim to the company
- The company can reimburse you tax-free
Avoid using company funds to pay for personal vehicle costs directly unless the vehicle is company-owned.
What Records Should You Keep?
HMRC requires robust mileage records, including:
- Date and purpose of each journey
- Start and end addresses
- Number of miles travelled
- Vehicle type used
Apps like Tripcatcher or MileIQ can help automate this process.
Common Mistakes to Avoid
- Claiming for commuting
- Forgetting to log each journey
- Mixing personal and business mileage
- Overestimating mileage without evidence
How Eclat Accountancy Can Help
At Eclat Accountancy, we help:
- Determine whether flat-rate or actual cost method is more tax-efficient
- Ensure your mileage records meet HMRC standards
- Assist with setting up compliant mileage tracking systems
Final Thoughts
Claiming for business mileage in the UK can significantly reduce your taxable income—if done correctly. In 2025, HMRC continues to focus on accurate record keeping and compliance, so it’s vital to get this right.
Need help with business mileage claims? Contact Eclat Accountancy today for tailored advice and support.
