HMRC Update to Statutory Mileage Allowance

On 21 May 2026, HMRC updated paragraph EIM31240 of its Employment Income Manual to reflect a newly announced increase in the statutory mileage allowances for cars and vans for the 2026-27 tax year onwards.

The revised rates, backdated to 6 April 2026, are as follows:

• 55p a mile for the first 10,000 miles (an increase of 10p from the previous rate).
• 25p a mile for additional miles (unchanged).

Employers should ensure they now reimburse their employees to reflect the revised rates. Consideration should also be given as to whether an uplift to payments already made for April and May 2026 to reflect the backdated increase, is required.

Employers that have been reimbursing their employees above the previous rates may need to revise their payroll calculations for April and May 2026 given the retrospective nature of the increase and employees who have been (or will be) reimbursed less than the revised rates may wish to consider claiming relief for the difference from HMRC.

A written ministerial statement made on 21 May 2026 confirms that the government will legislate retrospectively in respect of this change at the earliest opportunity.

If you need an updated expenses policy to deal with this change, then please contact Gemma Durham at Gemma.Durham@glaisyers.com