Mileage rules change, so employers should always check current HMRC guidance rather than relying on an old policy document.
The approved mileage rate changed
For the current 2026 to 2027 tax year, HMRC lists 55p per mile for the first 10,000 business miles in cars and vans, then 25p per mile for tax purposes. Check the current HMRC rates before applying them.
Mileage payments and vehicle costs are different
A mileage allowance is not the same as the actual cost of running a vehicle. Businesses should not use the approved rate as proof that a particular car or van costs that amount to operate.
Keep proper journey records
Business purpose, date, distance and employee records make reimbursement easier to support.
Own vehicles still create business risk
Employees using their own vehicles for work should have an appropriate licence, roadworthy vehicle and suitable insurance for business use.
Review old expense policies
A policy copied from earlier tax years may contain outdated rates or assumptions.