Mileage expenses

Employees using their own vehicles for work are entitled to receive certain payments free of tax and National Insurance contributions (NICs) - the rules for each are related but not identical.

If employees receive greater amounts than are allowed tax-free, they will pay tax on the excess. If they receive greater amounts than are allowed NICs-free, both employers and employees will be liable for Class 1 NICs on the excess.

If employees receive less than the respective amounts above, no NICs will be payable and tax relief will be available.

Information for employees

Information for employers

Information for others

HM Revenue & Customs guidance: Tax and NICs manuals