New mileage allowance rules for Motability users came into force on July 1, reducing the free mileage limit from 20,000 to 10,000 miles per year. Drivers who exceed the new limit will face a charge of 25p per mile, up from the previous rate of 5p per mile. The changes apply only to new leases; existing leases remain unaffected.
Motability had pledged to publish details of exceptions for essential travel by July 1 but missed the deadline. In an update, the scheme said it will now release the full information on July 8, 2026. The exceptions will cover journeys for healthcare, education, and employment, but not holidays or leisure activities.
Impact on Disabled Drivers
Concerns have been raised that the reduced allowance will disproportionately affect disabled people in rural areas or those who need to travel long distances for work. In a parliamentary question, Liberal Democrat Edward Morello asked the Secretary of State for Work and Pensions about the impact on disabled people in rural South West constituencies.
Minister of State for Social Security and Disability, Sir Stephen Timms, responded: "Responsibility for the Concerns and administration of the Scheme sits with Motability Foundation and its Board of Governors. The Department for Work and Pensions meets quarterly with Motability Foundation, to discuss the Schemes operation." He noted that approximately 75% of customers already use fewer than 10,000 miles per year.
Reasons for the Change
Motability stated that the mileage adjustment was driven by new tax costs announced in the Autumn Budget, which take effect from July 1. These costs would add an average of £1,100 to leases if no action were taken. The scheme said 73% of customers travel 10,000 miles or less annually and would be unaffected.
Separately, Motability halted its Drive Smart black box programme, which required all new first-time leases and named drivers under 30 to install a tracking device. The scheme admitted the user experience had been below par. Motability clarified: "The Drive Smart update does not relate to the mileage changes announced in March. Drive Smart was introduced to manage rising Scheme insurance costs."
Exceptions for Essential Travel
Motability said it will consider requests for additional support for customers whose travel is significantly higher due to healthcare, education, or employment. Eligible journeys include:
- Hospital and GP appointments
- Specialist treatment
- Other essential healthcare or support services
- Travel to your own education or training
- Taking your children to and from school
- Travel to and from work
Holidays or leisure activities will not be considered. Support is not automatic; each request will be assessed individually based on circumstances and supporting information.
What Happens Next
From July 8, 2026, Motability will publish full details on:
- Who can apply
- How to request support
- What supporting information may be required
- How requests will be assessed
- The support available if approved
- What to do if circumstances change during the lease
- How to request a review of a decision
Motability advised customers considering a new vehicle to wait until July 8 before ordering if they expect to exceed the standard allowance. For leases ending before July 8, customers should call to discuss options.
