Is the vehicle used for business purposes (not just commuting)?

Commuting vehicle costs are not claimable. Vehicle costs for travel between your home and regular workplace (commuting) are not deductible. This applies to all vehicle costs — fuel, wear and tear, and any method of claiming. Only genuine business journeys qualify.

Are you leasing (or on a contract hire) rather than buying outright?

Vehicle lease costs may be partially deductible. If you lease a vehicle for business use, you can claim the business proportion of lease payments. For cars with CO2 emissions above 50g/km, only 85% of the lease cost is deductible (a 15% restriction applies). For cars with lower emissions, the full lease cost may be deductible. The business use proportion still applies on top.

Would you prefer to use the simple mileage rate method?

Use HMRC mileage rates for simplicity. For your personal car used for business, HMRC offers simplified mileage rates: 45p per mile for the first 10,000 business miles, then 25p per mile. This single rate covers fuel, insurance, servicing, repairs, and depreciation. Most people find this the simplest option.

Is this for business journeys (not commuting)?

Claim mileage reimbursement from your company. The simplest approach is for the company to reimburse you at HMRC approved mileage rates: 45p per mile (first 10,000 miles), 25p per mile (after). This is tax-free to you and deductible for the company. Do not claim actual vehicle costs when using mileage rates.

Is the company considering buying or leasing a vehicle?

Company cars have benefit-in-kind tax implications. If your company provides a car, all running costs (fuel, insurance, servicing, road tax) are company expenses. However, you pay income tax on the car as a benefit-in-kind. The BIK amount depends on the car's list price and CO2 emissions. Electric cars currently have very low BIK rates.

Do you use your personal car for business travel required by your employer?

Employees cannot usually claim vehicle costs directly. As an employee, you generally cannot claim the running costs of your personal vehicle directly. Instead, your employer should reimburse business mileage at HMRC approved rates (45p/25p per mile). If they pay less, you can claim Mileage Allowance Relief on the shortfall.

Can I Expense This?

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Can I Expense Vehicle Costs?

Find out about claiming car and vehicle expenses including purchase, lease, insurance, and running costs.

Last reviewed: February 2026

Question 1

ℹ️This tool provides general guidance only, not professional advice. Results depend on your specific circumstances.

Can I Expense Vehicle Costs?

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Are you self-employed or a sole trader?

This includes freelancers and contractors not working through a limited company.

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Important disclaimer

This tool provides general guidance based on HMRC rules at the time of writing and is for informational purposes only. It does not constitute professional tax, legal, or financial advice. Tax rules change frequently and this information may be outdated or incomplete. No warranty is given as to accuracy. We accept no liability for any loss, damage, or consequences arising from reliance on this guidance. Use of this tool does not create a professional-client relationship. Your specific circumstances may differ significantly. Always consult a qualified accountant or tax advisor before making financial decisions.