Business Mileage Cost Calculator: Mileage Rates, Costs & How to Claim (UK)

On this page, business mileage cost calculator is the case in point: Business mileage cost is two calculations at once: what each mile actually costs to run the car, and what can be claimed for it. The running-cost side uses the same formulas as the rest of this site — fuel cost per mile from the fuel price and the MPG, tyre cost per mile from the tyre price and the mileage — and the claim side uses the published HMRC mileage rates, which in the UK are 45p per mile for the first 10,000 business miles in a car or van and 25p per mile after that. Those rates are the published figures at the time of writing, they apply in the UK, and they change, so check HMRC's current figures before claiming. This page works through both calculations with examples and explains how to keep the records that support a claim.

On this page, business mileage cost calculator is the case in point: The worked example below uses a tyre costing £130 as an example over an assumed 30,000 miles, giving 0.43 p per mile for one tyre, and a fuel example alongside it so the full cost per mile is visible. The HMRC rates are not a measure of the actual cost — they are the amount that can be paid tax-free for business mileage — so a car that costs more per mile than the rate leaves the difference with the driver, and a car that costs less keeps the difference. The sections below cover the tyre and fuel maths, the HMRC rates and how they work, the records to keep, and the mistakes that cause claims to be rejected.

The cost-per-mile formula for business mileage cost calculator

For business mileage cost calculator, the point is this: Cost per mile = tyre price ÷ expected mileage. For a single tyre, divide the price of one tyre by the miles it is expected to cover. For a set of four, the cost per mile is (4 × tyre price) ÷ expected mileage, which is four times the single-tyre figure. The result is usually expressed in pence or cents per mile: a tyre costing £130 over an assumed 30,000 miles gives £130 ÷ 30,000 = £0.0043, or 0.43 p per mile. The mileage in the formula is the uncertain half — it is an assumption or a measurement, never a guaranteed property of the tyre — so the worked example below states its assumptions plainly, and the section on measuring wear shows how to replace the assumption with a figure measured on the actual car.

business mileage cost calculator: What cost per mile means

For business mileage cost calculator, the point is this: Cost per mile is the simplest way to compare tyres on value rather than on price: it divides what the tyre costs by how far it goes, so a dearer tyre that lasts longer can work out cheaper than a cheap tyre that wears out quickly. The formula is cost per mile = tyre price ÷ expected mileage, and for a set of four it is (4 × tyre price) ÷ expected mileage, which is four times the single-tyre figure. The result is usually a few pence or cents per mile, and the table in this article shows it for three example prices against three example mileages so the pattern is visible. Every price and mileage here is an example used to show the working, labelled as such — no tyre's real-world mileage is stated as fact, because it depends on driving, alignment, pressure and load.

business mileage cost calculator: Worked example: £130 over 30,000 miles

Taking business mileage cost calculator as the case in point: Take a tyre priced at £130 as an example, with an assumed life of 30,000 miles. The cost per mile for one tyre is £130 ÷ 30,000 = £0.0043, which is 0.43 p per mile. A set of four costs £520 and lasts the same 30,000 miles, so the cost per mile for the set is £520 ÷ 30,000 = 1.73 p per mile. Over 10,000 miles of driving, the set costs 173.33 £ in tyre wear; over 12,000 miles a year it costs 208.00 £ a year. If the same tyre lasted 40,000 miles instead of 30,000, the cost per mile for the set would fall to 1.30 p; if it lasted only 20,000 miles, it would rise to 2.60 p. Both the price and the mileage are examples, labelled as such, and the mileage is the figure that matters most because it is the one that varies most between drivers.

Cost per mile table: three prices against three mileages for business mileage cost calculator

Taking business mileage cost calculator as the case in point: All prices and mileages are examples used to show the working. Read across for the mileage and down for the price.

Tyre price (example) 20,000 miles 30,000 miles 40,000 miles
£90 0.45 p per mile 0.30 p per mile 0.22 p per mile
£130 0.65 p per mile 0.43 p per mile 0.33 p per mile
£180 0.90 p per mile 0.60 p per mile 0.45 p per mile

Taking business mileage cost calculator as the case in point: The table shows the two directions of the formula at once: moving right along a row, the cost per mile falls as the mileage rises, and moving down a column it rises as the price rises. A £90 tyre over 20,000 miles costs 0.45 p per mile, while the same tyre over 40,000 miles costs 0.22 p — the same tyre, the same price, and a very different cost per mile, decided entirely by how long it lasts. That is why the mileage deserves more attention than the price: it is the bigger lever, and it is the one the driver can influence by the way the car is driven and maintained. Compare tyres at the same assumed mileage so the comparison is like-for-like, and use a measured wear rate where one is available.

HMRC mileage rates (UK) and how they work for business mileage cost calculator

In the UK, HMRC publishes approved mileage allowance payments: 45p per mile for the first 10,000 business miles driven in a car or van in a tax year, and 25p per mile for each mile after that. Those are the published rates at the time of writing, they apply in the UK, and they change — check HMRC's current figures before claiming. The rates are the amount an employer can pay tax-free for business mileage, not a measure of the actual cost of running the car: if the actual cost per mile is higher than the rate, the driver bears the difference, and if it is lower, the driver keeps the difference. Keep a log of every business journey — date, start and finish, purpose and miles — because a claim without records is difficult to support. Fuel, tyres, insurance, servicing and depreciation are the costs the rate is meant to cover, and the worked example above shows how the tyre and fuel parts are calculated. That is the point this page works through for business mileage cost calculator.

business mileage cost calculator: What decides how long a tyre lasts

Mileage is the uncertain half of the formula, and it is moved by several factors that are worth knowing before any comparison is made. Driving style matters most: hard acceleration, heavy braking and fast cornering wear the tread faster than smooth driving. Alignment matters next: a car that scrubs its tyres through a corner wears one edge of the tread and shortens the tyre's life. Inflation pressure matters too: under-inflation wears the shoulders and overheats the tyre, while over-inflation wears the centre. Load, road surface and temperature all play a part, and the tyre's own construction and compound set the starting point. Because so many factors move the mileage, the honest way to use the formula is with a mileage you have measured yourself — from the tread depth and the miles driven — rather than a figure quoted for the tyre. That is the point this page works through for business mileage cost calculator.

How to measure your own tyre mileage for business mileage cost calculator

Taking business mileage cost calculator as the case in point: A measured wear rate beats any quoted mileage, and it is easy to get. Measure the tread depth with a gauge when the tyres are new and write down the odometer reading. Drive a known distance — several thousand miles is enough — and measure again. The depth lost divided by the miles driven is the wear rate, and the depth remaining above the legal minimum divided by the wear rate is the remaining life. In the UK the legal minimum tread depth is 1.6 mm and in the USA it is 2/32 inch; both are jurisdiction-specific and subject to change, so confirm the current figure locally. Use the measured figure in the cost-per-mile formula and the answer describes the actual car rather than an average that may not apply to it.

Common mistakes with cost per mile for business mileage cost calculator

Taking business mileage cost calculator as the case in point: The most common mistake is comparing tyres by price alone, which is exactly what cost per mile exists to prevent: the cheapest tyre is often the dearest per mile. The second is putting a quoted mileage into the formula as if it were a measurement — it is at best an average under test conditions, and the actual mileage depends on driving, alignment, pressure and load. The third is forgetting that a set of four costs four times a single tyre, so the per-mile figure for the set is four times the single-tyre figure and the budget should be worked out on the set. The fourth is comparing tyres at different assumed mileages, which makes the comparison meaningless — use the same assumed mileage for every tyre so the comparison is like-for-like. And the fifth is ignoring the rest of the cost of driving: tyres are one line in the running cost, alongside fuel, insurance and servicing, and the cheapest tyre per mile is not necessarily the cheapest car per mile.

business mileage cost calculator: Related pages

Frequently asked questions

What are the HMRC mileage rates?

In the UK, HMRC's approved mileage allowance payments are 45p per mile for the first 10,000 business miles in a car or van in a tax year, and 25p per mile after that. Those are the published rates at the time of writing, they apply in the UK, and they change — check HMRC's current figures before claiming. That is the point this page works through for business mileage cost calculator.

What records do I need for a mileage claim?

Taking business mileage cost calculator as the case in point: Keep a log of every business journey: the date, the start and finish points, the purpose and the miles driven. A claim without records is difficult to support, and the log is also the basis for working out the actual cost per mile from fuel, tyres, insurance and servicing.

For business mileage cost calculator, does the HMRC rate cover the full cost of running the car?

On this page, business mileage cost calculator is the case in point: Not necessarily. The rate is the amount that can be paid tax-free for business mileage, not a measure of the actual cost. If the actual cost per mile — fuel, tyres, insurance, servicing and depreciation — is higher than the rate, the driver bears the difference. Work out the actual cost per mile using the formulas on this page.

How can I make my tyres last longer?

For business mileage cost calculator, the point is this: Keep pressures at the placard figure, checked cold; have the alignment checked when the tyres show uneven wear; drive smoothly instead of accelerating hard and braking late; avoid overloading the car; and rotate the tyres if the manufacturer recommends it. Each of these extends the mileage in the formula, which cuts the cost per mile directly.

What is the legal minimum tread depth?

In the UK the legal minimum tread depth is 1.6 mm across the central three-quarters of the tread, and in the USA it is 2/32 inch. Both are jurisdiction-specific limits and they change, so check the current figure where the car is used. Most drivers replace tyres before the legal minimum, because wet grip falls off well before the tread is bare. That is the point this page works through for business mileage cost calculator.