If you use your own car for work, HMRC lets you claim a set amount per mile to cover fuel and wear. The catch is that you need a proper record. A simple Excel mileage log does the job perfectly and works out your claim automatically. In this guide I will show you how to build one that follows HMRC’s approved mileage rates and stands up if anyone ever asks to see it. Done well, it can be worth a meaningful tax saving every year for very little effort.
The mileage method exists because tracking every penny of fuel, servicing, insurance and depreciation for a car you also use privately is a nightmare. Instead, HMRC offers a flat rate per business mile that is deemed to cover all of those running costs. You keep a log of your business journeys, multiply by the rate, and that is your claim. It is simple by design, but the simplicity only holds if your log is complete and believable, which is where a good spreadsheet earns its keep.
The HMRC mileage rates
For cars and vans, HMRC’s approved rate is 45p per mile for the first 10,000 business miles in the tax year, then 25p per mile after that. Motorcycles are 24p throughout, and bicycles are 20p. These are the “approved mileage allowance payments”, and they are designed to cover running costs without you keeping fuel receipts.
| Vehicle | First 10,000 miles | Above 10,000 miles |
|---|---|---|
| Car or van | 45p | 25p |
| Motorcycle | 24p | 24p |
| Bicycle | 20p | 20p |
Step 1: Set up the log columns
Each journey needs enough detail to prove it was for business. I use the date, the route, the reason for the trip and the miles. The reason matters: “client meeting at Harbour Ltd” is fine, “out and about” is not.
| Date | From / To | Purpose | Miles |
|---|---|---|---|
| 03/04/2026 | Office to Harbour Ltd | Client meeting | 32 |
| 11/04/2026 | Office to wholesaler | Stock collection | 18 |
| 22/04/2026 | Office to site visit | Quote for new job | 54 |
Step 2: Total your miles for the year
At the bottom of the miles column, add a running total with =SUM(D2:D200), giving yourself plenty of rows to fill in. This is your total business mileage, and it drives the whole claim. It is worth adding a count of trips too, with =COUNT(D2:D200), so you can see at a glance how many journeys you have logged and spot any gaps where a busy week has no entries at all.
The most reliable logs are the ones filled in as you go, not reconstructed months later from memory. A spreadsheet on your phone, or a quick note jotted down and typed up weekly, beats trying to remember in March where you drove last April. If you do a regular run, such as a weekly trip to the same wholesaler, you can pre-fill those rows and just confirm them, which keeps the habit light enough to actually stick.
Step 3: Apply the two-tier rate
Here is where people stumble: the rate drops after 10,000 miles. The clean way to handle both tiers in one formula, with total miles in D201, is:
=MIN(D201,10000)*0.45+MAX(0,D201-10000)*0.25
The first part charges 45p on up to 10,000 miles; the second part charges 25p on anything above. If you never pass 10,000 miles, the second part is simply zero, so the formula still works. Wrap it in =IFERROR(...) if you like, though with these inputs an error is unlikely.
It is worth understanding why this single formula beats the obvious alternative of two separate sums. If you split the year into “first 10,000” and “the rest” by hand, you have to keep moving the dividing line every time you add a journey, and it is easy to double-count or miss miles around the boundary. The MIN and MAX version never needs touching: feed it your running total and it always splits the miles correctly, whether you are at 3,000 for the year or 18,000. That is the mark of a formula built to last a whole tax year without maintenance.
What counts as a business journey
This is the question I am asked most, because getting it wrong is costly. The key principle is that travel from home to your normal, regular place of work is ordinary commuting and cannot be claimed, no matter how far it is. What you can claim is travel made in the course of doing your job: visiting a client, going to a supplier, driving between two workplaces, or heading to a temporary site. A trip from home straight to a client you do not normally visit usually qualifies, whereas your daily drive to the office you always work from does not. When a journey is part business and part personal, log only the business portion. If you are ever unsure about an unusual journey, note your reasoning in the purpose column so you have a clear record of why you treated it the way you did; that contemporaneous note is exactly what makes a claim defensible.
Step 4: Keep it tidy for the tax return
Total the claim once per tax year, which runs from 6 April to 5 April. If you are a sole trader, this figure goes into your Self Assessment as a vehicle expense; if you run a limited company and pay yourself the mileage, it is reimbursed tax-free up to these rates. Either way, keep the log with your records for at least the period HMRC can ask about. Our mileage claim template has these tiers built in, and the figure flows neatly into our Self Assessment expenses template.
A quick note on choosing the mileage method in the first place. Once you start claiming the flat rate for a particular vehicle, you generally need to stick with it for that vehicle rather than switching back and forth to actual costs each year. For most people the mileage rate is both simpler and more generous, especially for an economical car, but if you run a thirsty van for very high mileage it can be worth doing the sums both ways once at the start. After that, the spreadsheet does everything for you, year after year.
Finally, do build in the small sense-checks. A line showing =IF(D201>10000,"Two-tier rate applies","Single rate") reminds you why your figure looks the way it does once you pass the threshold. These little notes cost nothing and make the workbook far easier to trust, both for you and for an accountant glancing over it at year end.
Common mistakes
- Claiming commuting. Travel from home to your normal workplace does not count. Only genuine business journeys qualify.
- Charging 45p on everything. Remember the rate falls to 25p after 10,000 miles. The two-tier formula handles it for you.
- Vague descriptions. Record where you went and why. A bare mileage figure with no purpose is hard to defend.
- Mixing personal trips in. Log only the business miles, or split a part-personal journey to the business portion.
Frequently asked questions
What is the HMRC mileage rate for 2026?
For cars and vans it is 45p per mile for the first 10,000 business miles in the tax year and 25p per mile after that. Always check HMRC for the current figures, as rates can change.
Can I claim mileage and fuel receipts?
No. The approved mileage rate already covers fuel and running costs, so you claim one or the other, not both. The mileage method is simpler for most people.
Does the 10,000-mile limit reset each year?
Yes. The higher 45p rate applies to the first 10,000 business miles in each tax year, which runs from 6 April to 5 April.
Do I need to keep the mileage log?
Yes. HMRC can ask to see your records, so keep your log alongside your other tax paperwork. A dated Excel log with the purpose of each trip is ideal.
