Fuel costs

Partial

Fuel used for business journeys is deductible. You can either claim actual fuel costs (keeping all receipts and a mileage log) or use HMRC's flat mileage allowance (Approved Mileage Allowance Payments, or AMAP): 55p per mile for the first 10,000 business miles in the tax year, 25p per mile after that. The mileage allowance covers cars and vans. Most sole traders use it as it's simpler and covers all vehicle running costs in one rate.

Key thresholds

55p/mile for first 10,000 business miles in the tax year (cars and vans), 25p/mile after. Motor cycles: 24p/mile flat. Bicycles: 20p/mile flat.

Common questions

Should I use the flat mileage rate or claim actual fuel costs?

For most trades, the flat mileage rate is simpler and often gives a higher deduction. Actual costs require detailed receipts for every fill-up and a mileage log to work out the business share of use. Choose carefully: once you use the flat rate for a vehicle, HMRC requires you to keep using it for as long as you use that vehicle in the business, not just for the year.

What does 8,000 business miles come to on the flat rate?

£4,400. The first 10,000 business miles in the tax year are at 55p, so 8,000 × 55p = £4,400 off your profit, and that covers fuel, insurance, repairs and the rest of the running costs in one figure.

Can I claim fuel for driving to and from my home to a regular job site?

No. HMRC is clear: you cannot claim for travel between home and work. But travel to different client sites, or from one site to another during the day, is deductible.

Watch out for

If you use the flat mileage rate (AMAP), you cannot also separately claim fuel, insurance, repairs, or other running costs for the same vehicle. The rate covers everything.
Passenger payments: you can claim an additional 5p per mile per passenger (fellow employees on the same business journey) on top of the mileage allowance.

Common mistakes

Switching between the mileage rate and actual costs for the same van. Once you use the flat rate for a vehicle, you keep it for as long as that vehicle is in the business.
Claiming home-to-work commuting miles. Only journeys in the course of the work count.
Claiming fuel receipts on top of the mileage rate. The rate replaces them.

Cash basis vs traditional accounting

Fuel (or the mileage rate) is a day-to-day cost on both methods, deducted in the period it was paid or the miles were driven.

The mileage allowance rate (AMAP) is set by HMRC and reviewed periodically. Check the current rate before filing.

HMRC sources

https://www.gov.uk/expenses-if-youre-self-employed/travel https://www.gov.uk/government/publications/rates-and-allowances-travel-mileage-and-fuel-allowances/travel-mileage-and-fuel-rates-and-allowances https://www.gov.uk/simpler-income-tax-simplified-expenses/vehicles

Last verified: August 2026 · Tax year 2026/27

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Self-employed tax, explained Self-employed tax calculator Mileage allowance calculator

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This guidance is for general information only. Tax rules change. Verify with HMRC or a qualified accountant before filing.

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