Van mileage for a sole trader: 55p for the first 10,000 miles, 25p after, worked for 8,000, 14,000 and 20,000 miles

A plumber works alone and drives about 14,000 business miles a year. Last year the accountant used flat-rate mileage. This year the van needs tyres, an MOT and a service, and the plumber asks whether keeping receipts is better. Before comparing, the first thing to know is what the flat rate gives. This guide has the numbers for the 2026 to 2027 tax year and the rule that stops the choice being made again each year.

The rule on GOV.UK

For cars and goods vehicles the flat rate is 55p a mile for the first 10,000 miles and 25p a mile after that, for the 2026 to 2027 tax year. GOV.UK says the first-10,000-mile rate was 45p before 6 April 2026. Motorcycles are 24p a mile with no change at 10,000. The page's own example is 11,000 miles, claimed as £5,750: 10,000 at 55p plus 1,000 at 25p.

You can claim other travel costs, such as train fares and parking, on top.

The flat rate in pounds

Our arithmetic. At the old 45p, 14,000 miles would have been £4,500 plus £1,000, which is £5,500, so the new rate is £1,000 higher on that mileage.

The two limits to know first

GOV.UK says simplified expenses cannot be used for cars designed for commercial use, such as a black cab, nor for a vehicle for which capital allowances have already been claimed or which has been included as a business expense. The plumber who bought the van through the business and claimed the allowance is therefore on actual costs for that van.

The second is the lock: "once you use flat rates for a vehicle, you must continue to do so as long as you use that vehicle for your business." The year-one choice is a choice for the vehicle's whole life with that trader, so it deserves five minutes of arithmetic: expected miles, fuel, insurance and servicing.

Why it matters in the year of the van

The year a van is bought or replaced is when the choice is made, and the flat rate looks poor beside a large purchase. A trader with a high-mileage year does well on the rate because the first 10,000 miles carry 55p. Someone who covers 25,000 miles a year earns only 25p on 15,000 of them, so the lock-in deserves a second look for them.

What to ask the tradesperson

• How many business miles, from a log? Home to a fixed workplace is not business mileage; the page does not cover that, so ask the accountant.
• Was the van put through the books? If so the flat rate is out.
• Is a second vehicle used? Each vehicle has its own method.
• Is the mileage log kept at the time? An after-the-fact estimate does not stand up well.

Mileage is only one line. When a customer does not pay, the next step is a different problem, and the CIS calculator shows the deductions that sit alongside it for a subcontractor.

I did not read what the page says about vans that are not goods vehicles, or the rules for partnerships, so check the full page.

Overlyft builds AI staff who join your small trade business and read your job diary and fuel receipts to total business miles by month, then show you the flat-rate figure next to your actual costs for you to decide.

This is general information, not tax advice. Check GOV.UK and your own figures before you file.