Mileage & Van
New 55p Mileage Rate 2026 — What It Means for Self Employed Builders
From April 2026, the HMRC approved mileage rate jumped from 45p to 55p per mile — the first increase in over a decade. For a self employed builder driving between sites every day, the difference is significant.
What changed
The new rate applies from 6 April 2026 for the first 10,000 business miles in the tax year. After 10,000 miles, the rate stays at 25p per mile. The 55p covers everything: fuel, insurance, road tax, servicing, repairs, depreciation.
How much difference does it make?
| Annual business miles | Old rate (45p) | New rate (55p) | Extra deduction | Tax saved (20%) |
|---|---|---|---|---|
| 6,000 | £2,700 | £3,300 | £600 | £120 |
| 8,000 | £3,600 | £4,400 | £800 | £160 |
| 10,000 | £4,500 | £5,500 | £1,000 | £200 |
| 12,000 | £5,000 | £6,000 | £1,000 | £200 |
A builder doing 10,000 business miles and paying higher-rate tax saves £400 compared to last year from the mileage rate change alone.
What counts as a business mile for a builder?
- Driving between job sites
- Going to the builders’ merchant for materials
- Travelling to a customer’s property for a quote
- Driving to the tip or skip yard
- Going to training courses
If you work from home and travel to different sites each day (which most builders do), every journey from home to site is a business journey.
You can claim parking, congestion charges, ULEZ fees and tolls on top of the 55p rate. They’re separate allowable expenses. Parking fines are never deductible.
How to keep records
Log every business journey with the date, start/end points, purpose, and miles. BuilderLog calculates the claimable amount automatically at 55p/mile when you enter the distance against a job.
Simplified expenses or actual costs — not both
The 55p rate is part of HMRC’s simplified expenses system. You claim a flat rate per mile and it covers everything: fuel, insurance, road tax, servicing, repairs, depreciation. You don’t need receipts for individual van costs.
The alternative is tracking actual vehicle costs — every fuel receipt, every MOT, every insurance payment — and claiming the business proportion. More admin, sometimes a bigger deduction if your van costs are high.
Critical rule: once you choose simplified mileage for a vehicle, you must stick with it for the life of that vehicle. You cannot switch to actual costs later. For most builders, simplified mileage at the new 55p rate is the better option.
International rates
BuilderLog automatically applies the correct rate for your country:
| Country | Rate | Unit |
|---|---|---|
| United Kingdom | 55p | per mile |
| United States | 76¢ | per mile |
| Canada | C$0.73 | per km |
| Australia | A$0.91 | per km |
| Ireland | €0.43 | per km |
What if I didn’t log last year’s mileage?
You can’t retrospectively claim mileage you didn’t record. HMRC requires a contemporaneous log — meaning you recorded the journeys at or near the time they happened. A retrospective estimate reconstructed from memory will be rejected if investigated.
This is exactly why starting a logging habit now matters. Every day you don’t record is a deduction you lose permanently. BuilderLog lets you log mileage against each job in seconds — the claimable amount is calculated automatically.
Common mileage mistakes builders make
Not claiming at all: This is the most expensive mistake. A builder doing 8,000 miles unclaimed loses £880 in tax at basic rate — every year.
Claiming personal miles: Only business journeys qualify. The school run, the supermarket, the weekend trip — these are not business miles even if you use your work van.
Claiming commuting miles: If you have a fixed workplace you go to every day, the journey from home to that workplace is commuting, not business. But if you work from home and travel to different customer sites (which most builders do), every home-to-site journey is business.
Round-tripping: If you drive to a job site and back home, both legs are business miles. Don’t forget the return journey.
Forgetting merchant runs: Driving to the builders’ merchant for materials is a business journey. So is driving to the tip, the skip yard, or the scaffolding company. Log them all.
The bottom line
A builder doing 10,000 miles a year and not claiming them is handing over £1,100 in unnecessary tax at basic rate. Start logging today — it takes 30 seconds per journey.
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