Martin Lewis has welcomed a boost to the UK's mileage allowance, describing the change as "really important" for employees and self-employed workers who use their own vehicles for work.
The MoneySavingExpert founder highlighted the increase after the Government confirmed the approved mileage allowance for cars and vans will rise from 45p to 55p per mile for the first 10,000 business miles driven each tax year. The change was applied from April 6 2026.
Who benefits from the mileage allowance increase?
The allowance applies to people who drive their own car or van for work, such as care workers travelling between clients or anyone who needs to visit different locations as part of their job. It does not cover normal commuting to and from work.
Speaking on BBC Radio 5 Live, Martin Lewis said: "The big one that I think is going to be under-covered, but is actually really important, is the increase in the mileage allowance for people who drive as part of their work. This has been frozen at 45p since, I think 2011, so the increase from 45p to 55p for the first 10,000 miles that you drive is really important."
Tax relief and employer reimbursements
He explained that employers can reimburse workers up to the approved mileage rate without the payment being subject to tax or National Insurance.
Lewis also pointed out that drivers could still be entitled to tax relief if their employer pays less than the approved rate. He said: "It is also worth noting, if your employer doesn't give you the full amount of the mileage allowance – let's imagine they give you 30p (and the allowance is 55p) – you can claim tax back on that 25p per mile that you drive as part of your work (not commuting)."
He added: "If they didn't give you anything, you could claim [tax back on] the full 55p."
Rates after 10,000 miles and for other vehicles
After the first 10,000 business miles, the approved mileage rate for cars and vans falls to 25p per mile. The change also applies to self-employed workers using their own vehicles for business, while mileage rates for motorbikes and bicycles remain unchanged at 24p and 20p per mile respectively.
