Mileage Reimbursement Calculator

For 2024 the IRS standard business mileage rate is 67¢ per mile, set in Notice 2024-08 (announced as IR-2023-239 on December 14, 2023). For 2023 it was 65.5¢. Self-employed taxpayers can claim it as a deduction on Schedule C, and employers commonly use it as the tax-free reimbursement rate for employees who drive personal vehicles on business — anything paid above the IRS rate is taxable wages, anything paid at or below is non-taxable. The IRS also sets separate medical/moving (21¢ for 2024) and charitable (14¢, fixed by statute) rates. The full announcement is on irs.gov/newsroom.

HMRC publishes Approved Mileage Allowance Payments (AMAPs). For cars and vans the rate is 45p per mile for the first 10,000 business miles in a tax year (April 6 to April 5), then 25p per mile thereafter. Motorcycles are a flat 24p per mile and bicycles 20p per mile. Employers paying at or below these rates do not need to report the reimbursement and the employee owes no tax on it; anything paid above counts as taxable benefit-in-kind and goes on a P11D. Employees whose employer reimburses below the AMAP rate can claim Mileage Allowance Relief on the difference via their self-assessment return. Current rates are at gov.uk/expenses-and-benefits-business-travel-mileage.

In most jurisdictions, mileage reimbursement paid at or below the tax authority's "safe-harbour" rate is non-taxable to the employee and fully deductible to the employer — it is treated as reimbursement of a business expense rather than wages. In the US that benchmark is the IRS standard mileage rate (67¢/mile for 2024). In the UK it is the HMRC AMAP rate (45p/25p). In Canada it is the CRA "reasonable" rate (70¢ for the first 5,000 km, 64¢ thereafter, for 2024). Anything paid above the benchmark is generally taxable to the employee as ordinary income and the excess is subject to payroll taxes. Anything paid below is non-taxable, and in the UK the employee can claim Mileage Allowance Relief on the shortfall.

It depends on jurisdiction and circumstances. The US IRS lets self-employed taxpayers choose, year by year, between the standard mileage rate (simple — multiply business miles by 67¢) and the actual-expense method (track gas, insurance, repairs, depreciation, and apportion the business-use percentage). The standard rate wins for fuel-efficient cars driven a lot of business miles; actual expenses tend to win for expensive or low-MPG vehicles. There is an IRS catch: once you use the actual method in the first year of business use for a vehicle, you can never switch to the standard rate for that vehicle. The UK does not have an actual-expense method for employees claiming back business travel — only AMAP applies — but self-employed sole traders can pick between AMAP-style simplified expenses and full vehicle expense tracking.

Split the calculation into two runs. For HMRC: run once with the first 10,000 business miles at 45p/mile, run again with everything over 10,000 at 25p/mile, and add the two totals. For CRA: the first 5,000 km in a tax year are reimbursable at 70¢, anything over at 64¢ (2024 rates). The driver's personal records — a mileage log, or a corporate fuel-card report — should track total business miles for the year so you know when you cross the threshold. If you only drive a few thousand miles a year you will never hit the cap and the calculation stays a single multiplication.

It is meant to cover the full marginal cost of operating a personal vehicle on business — not just fuel. That is why the per-mile rate (67¢ in the US, 45p in the UK) is far higher than the cost of gas or petrol alone: it bundles fuel, oil, insurance, registration, depreciation, repairs, and maintenance into a single figure. The tax authorities calculate the rate annually using fixed-and-variable-cost studies. If your employer pays only a "fuel reimbursement" at a lower rate, it is technically under-paying you for vehicle wear, and in the UK that gap is what Mileage Allowance Relief is designed to claw back.