HMRC Mileage Rates 2026/27 - Capture Expense
Get the latest HMRC mileage rates for 2026/27—approved rates for cars, vans, motorcycles and bikes, advisory fuel rates, & compliance.
captureexpense.comHere are the latest updates on mileage allowance for 2026.
What’s new
- The IRS mileage rate for business use in 2026 has been set at 72.5 cents per mile, up from 70 cents in 2025. This is the general business rate used to calculate reimbursements for using a personal vehicle for work. [sources indicate IRS Notice 2026-10 and related coverage]
- For medical mileage, the rate decreases slightly to 20.5 cents per mile in 2026. Moving mileage also uses 20.5 cents per mile but is limited to certain qualified individuals (e.g., certain active-duty military and eligible intelligence-community members). Charitable mileage remains at 14 cents per mile.
- When using a fixed-and-variable rate (FAVR) plan, the maximum allowable cost basis for the vehicle used in 2026 increases to $61,700 from $61,200 in 2025. The maximum fair market value (FMV) for employer-provided vehicles first made available to employees for personal use also increases to $61,700 (up from $61,200).
- Employers can exclude up to $340 per month from an employee’s income for certain transportation benefits (commuter transit, rides, and/or qualified parking) in 2026. This aligns with transportation benefit guidance issued earlier.
Global context (some regions use similar terminology)
- In other jurisdictions, mileage allowance debates continued into 2026, with UK HMRC-style rates often remaining steady or periodically updated; however, the primary North American update in 2026 centers on the IRS standard mileage rate. If you’re looking for UK rates specifically, I can pull the latest HMRC figures as well.
What this means for you
- If you reimburse employees for business travel using the standard rate, plan for 72.5 cents per mile in 2026. This affects budgeting, payroll, and reimbursement policies.
- If you claim medical or moving mileage, use 20.5 cents per mile in 2026 where eligible.
- For employers using FMV- or cents-per-mile valuation methods for employer-provided cars, update FMV thresholds to reflect the 61,700 FMV cap.
- Consider the monthly $340 transportation benefit maximum when structuring employee benefit packages.
Would you like a concise comparison table of the 2025 vs 2026 rates (business, medical, moving, charitable) and the FMV thresholds? I can also tailor guidance to your location (US vs UK) if you specify which jurisdiction you need.