HMRC Mileage Rates 2026 for Birmingham Drivers: Private Use and Business Miles FAQ

If you want to know how HMRC mileage rates 2026 apply when the same car does business and private miles, the answer is simple. For 2026/27 you claim 55p for each of your first 10,000 business miles and 25p after that, and you never claim a rate for private miles. This guide is written for Birmingham drivers who use one car for ride-hailing work, the school run and the weekend.

According to HMRC's simplified expenses guidance for vehicles, the flat rate replaces the actual cost of buying and running the vehicle. The hard part is not the rate. It is proving which miles were business and which were not. We have already covered the Cardiff backdated catch-up and the changing-car question for Newcastle, so this article sticks to the private-use split.

Key takeaways

• The 2026/27 simplified rate is 55p for the first 10,000 business miles and 25p after that. Before 6 April 2026 it was 45p.
• Only business miles earn a rate. Private miles earn nothing and are simply left out of the claim.
• Travel between home and work, and any non-business driving, is not an allowable expense. Check GOV.UK for how it applies to your pattern of work.
• With a log you count business miles directly. Without one you must build a reasonable estimate, and that is far harder to defend.
• Once you use the flat rate for a vehicle, you must keep using it for that vehicle while it is in the business.

What is the private-use split for HMRC mileage rates?

The private-use split is the share of a vehicle's yearly miles driven for business, compared with the share driven for personal reasons. Only the business share can be claimed. HMRC's flat rate is multiplied by business miles alone, so the private share never enters the calculation.

If you do not use the flat rate, the same idea applies to actual costs. You work out the cost of fuel, insurance, repairs and so on, then claim only the business proportion.

How do HMRC mileage rates 2026 work for a car that is also private?

You multiply your business miles by the rate and ignore everything else. For 2026/27, that is 55p on business miles up to 10,000 and 25p on business miles above that. Private miles do not count towards the 10,000 band, so a busy private life does not cost you the higher rate.

HMRC's announcement on the increase says the rise applies from 6 April 2026 and is retrospective, because it was published after the tax year began. It also says self-employed people using simplified mileage can deduct the higher rate when working out taxable profit. The return due by 31 January 2027 covers 2025/26 and uses 45p for the first 10,000 miles. Our personal tax checklist for the mileage allowance shows where each year's figure goes.

Which tax year are your miles in?

Miles driven up to 5 April 2026 belong to 2025/26 at 45p. Miles from 6 April 2026 belong to 2026/27 at 55p. If you drive across the boundary, your log needs dates so the two pots stay apart. A log that only holds yearly totals cannot do this, which is one more reason to record trips as you go.

Does the flat rate already cover the private share of my car?

The flat rate does not include any private share, because you only apply it to business miles. HMRC says the rate replaces actual costs of buying and running the vehicle for business use. GOV.UK's vehicle page does not discuss private use directly, so check GOV.UK if your case is unusual.

In practice this means there is no separate "private use deduction" under the flat rate. The private share is dealt with before you start, when you decide which trips count as business miles. If you instead claim actual costs, you apportion every cost by business use. The total of costs is then reduced to the business share before it reaches your return.

Which trips count as business, and which are private?

Business trips are journeys made to earn your income, such as driving to pick up a booked passenger or taking a fare to the destination. Private trips are those made for your own reasons. HMRC says you cannot claim "travel between home and work" or "non-business driving". The table below is our own working guide, not an HMRC list.

The "check GOV.UK" rows are where drivers argue with each other online. We prefer caution: a smaller claim you can explain beats a bigger one you cannot. If you are unsure, read HMRC's page on what travel you can claim or ask us.

What about the trip from home to the first pick-up of the day?

Treat it as unclaimed unless you have checked GOV.UK or taken advice. HMRC lists travel between home and work as something you cannot claim, and its pages do not spell out how that applies to a driver with no fixed workplace. Hedge, record it separately, and decide later.

A sensible habit is to log the start of your first accepted job, not the moment you leave the driveway. That way the log shows clean business miles. If you later learn a trip qualifies, the note lets you add it without guessing.

Why keeping the commute separate helps in an enquiry

When HMRC asks questions, an unclear first and last trip is the easiest place to start. A log that keeps these trips visible, and labelled, shows you thought about the rule. Our guide to the HMRC enquiry on 55p claims explains what that process looks like.

How do I estimate my private-use split if I keep a mileage log?

With a log, you do not estimate. You add up business trips for the year, add up the rest, and compare each with your odometer readings. If business plus private matches the odometer movement closely, the log is credible. Gaps should be explained in a note rather than ignored.

1. Write down the odometer reading on 6 April 2026 and again on 5 April 2027.
2. Log every business trip with date, start, finish, purpose and miles, using an app, notebook or spreadsheet.
3. Add up the business miles. Cap the 55p band at 10,000 business miles.
4. Subtract business miles from total odometer miles. The remainder is private, including commuting and family use.
5. Work out the business percentage and keep it with the log for your records.
6. Apply 55p to the first 10,000 business miles and 25p to the rest.
7. Keep the log and the odometer photos with your other records, as set out in HMRC's guidance on business records.

Our separate article on mileage log records and bookkeeping covers the log format in detail. If you want a quick sum, use our mileage calculator.

How do I estimate the split if I do not keep a log?

Without a log, you can only build a reasonable estimate from other evidence, and it will carry more risk. Start from the odometer readings, then use the best proof you have: platform statements, bookings, MOT mileage and service records. HMRC expects records, so check GOV.UK for what it accepts.

An estimate is a fallback, not a plan. Rebuilding a year from memory tends to overstate business miles, because people forget the private ones. If you did not log from 6 April 2026, start today and keep a proper record for the rest of the year. Anything you reconstruct should be labelled as an estimate and be one you could explain calmly.

Evidence you can use to rebuild a year

• Odometer photos from MOT tests, services and insurance renewals.
• Trip history exports from your driver app, which show dates and distances but not always your own repositioning miles.
• Diary entries, calendar events and fuel receipts showing dates and places.
• A sample period, such as a typical week, logged properly and compared with the year.

A sampled week is a rough guide only. Do not extrapolate it as if it were a log, and check GOV.UK or speak to an accountant before relying on it.

Should I choose actual costs instead of the flat rate when my car is half private?

It depends on your running costs and your business share. If a lot of the car's use is private, actual costs are cut down to the business percentage, which can leave the flat rate looking better. If your costs are high and your business share is high, actual costs may win. Run both numbers.

The choice matters because HMRC says that once you use flat rates for a vehicle you must carry on while you use it for business. You do not have to use them for every vehicle. For capital allowances and the actual-costs method, see GOV.UK's vehicle expenses page.

Comparison of the two methods for a mixed-use car

Illustrative example: one car, 18,000 miles, four uses

This illustrative example uses an invented Birmingham driver with one saloon car. The figures are made up to show the maths and are not a benchmark.

Between 6 April 2026 and 5 April 2027 the odometer moves 18,000 miles. The log shows 14,400 business miles and 3,600 private miles, which is a business share of 80%. The private miles are the weekend trips, family visits and shopping.

• First 10,000 business miles at 55p = £5,500.
• Remaining 4,400 business miles at 25p = £1,100.
• Total flat-rate claim for the year = £6,600.
• Private miles claimed = nil, and they do not use up any of the 10,000 band.

Now suppose the same driver's actual running costs for the year, such as fuel, insurance, servicing and tax, came to £7,500. The business share at 80% is £6,000. In this invented case the flat rate gives £600 more deduction, before capital allowances or other considerations. That says nothing about your own car, so run your own sums.

A claim is a deduction from profit, not a refund. The tax saved depends on your overall income and tax band. Please do not read this as a promise of any saving.

Does the 10,000-mile band count private or family miles?

No. The 10,000-mile band counts business miles only. Private, family and commuting miles do not move you towards the lower 25p rate. You only reach 25p once your business miles for the tax year pass 10,000, and the band starts afresh each 6 April.

This is why splitting properly can feel odd. A driver who does mostly private miles may never leave the 55p band. A full-time driver may pass 10,000 business miles in the autumn, as our guide to the 10,000-mile switch explains.

What do Birmingham drivers need to think about locally?

Birmingham drivers should check two local points alongside the tax rules: their licence and any clean air charges for the car. These are not tax questions, but they affect which car you run and how long you keep it. Use the council's own pages for current rules.

• Private hire licensing is handled by the local council, so check Birmingham City Council for current vehicle and licence requirements.
• Check the council site for any clean air zone charges that apply to your vehicle. A daily charge is a business cost if you pay it while working, but check GOV.UK before claiming it alongside the flat rate.
• Our Birmingham accountant page and the Birmingham 2026 update cover local practice.

Parking and tolls can usually be claimed on top of the flat rate when they are business costs. HMRC's simplified expenses guidance says you can still claim other travel costs such as parking, but fines and penalty charges are never claimable.

What common mistakes cause trouble with private use?

Most problems come from claiming too much, keeping too little evidence or mixing tax years. Each mistake below can lead to a corrected claim, interest or a penalty, depending on whether HMRC sees the error as careless. Check GOV.UK for the current penalty rules before you file.

• Claiming every mile on the odometer. Penalty: HMRC can amend the claim and, if the error was careless, charge a penalty on the extra tax. Check GOV.UK for the current penalty rates.
• Including the commute or first and last trips without checking. Penalty: a corrected claim and possible interest on the tax underpaid.
• Rebuilding a log from memory at the filing date. Penalty: weak evidence, and a harder conversation if HMRC asks questions.
• Mixing 2025/26 and 2026/27 miles in one total. Penalty: the wrong rate is applied, either overclaiming or underclaiming.
• Switching from flat rate to actual costs mid-year for the same car. Penalty: breaking the rule that the flat rate stays for that vehicle.
• Forgetting that the 10,000-mile band covers business miles only. Penalty: an understated claim, so you lose tax relief you were entitled to.

Where HMRC opens an enquiry or proposes a penalty, professional representation is wise. Our HMRC support service handles that for drivers.

Key terms

• Simplified expenses: HMRC flat rates you can use instead of working out some actual costs.
• Business mile: a mile driven to earn your trading income, not a private or commuting mile.
• Private use: any driving for personal or family reasons.
• Apportionment: splitting a mixed-use cost into business and private shares.
• Odometer: the car's own mileage counter, used to check your log.
• HMRC: His Majesty's Revenue and Customs, the UK tax authority.

How UK Driver Accountants helps

UK Driver Accountants works only with drivers, on fixed fees from £20 a month, and we are independent of any ride-hailing app. We can review your log, set up the private-use split and make sure the right rate lands in each tax year. See our personal tax service and pricing.

Next steps for Birmingham drivers

Start your log today, keep private trips in it, and photograph the odometer on the first and last day of each tax year. If you would like a second pair of eyes before 31 January 2027, contact us and we will go through your records with you.

Last reviewed 14 November 2026 by the UK Driver Accountants tax team

This article is general information and is not personal tax advice. Your circumstances may differ, so speak to a qualified accountant before you file. If HMRC disputes a claim or proposes a penalty, professional representation is recommended.