Your driving
See what keeping the 5p fuel duty cut saves you in 2027, and, if you drive for work, what the higher tax-free mileage rates are worth.
Budget figures current for 2026/27 and 2027/28, last checked against GOV.UK.
Results update as you type
Your results
The 5p cut was due to start coming back in January 2027. Keeping it until 1 July 2027 means you pay 6p a litre less than planned for six months, VAT included.
Tax-free mileage rates
For a car or van of your own used for work. Employers can pay up to these rates tax-free; if they pay less, you can claim tax relief on the difference.
| Business miles in a tax year | Without the Budget | 2026/27 | From 6 April 2027 |
|---|---|---|---|
| The first 10,000 | 45p | 55p | 55p |
| Above 10,000 | 25p | 25p | 35p |
55p for the first 10,000 miles has applied since 6 April 2026 as a temporary rate; the Budget makes it permanent, and raises the rate above 10,000 miles from April 2027. Without it, both would have gone back to 45p and 25p. Motorbikes (24p) and bicycles (20p) are unchanged.
Your work miles
| On your work miles | Without the Budget | From 6 April 2027 | Difference |
|---|
Using this calculator
Choose what your car runs on, then enter the miles you drive in a year and its miles per gallon. If you drive your own car or van for work, enter those miles too, and the calculator shows the tax the higher mileage rates save you from April 2027.
- The fuel duty saving is against what was planned before the Budget: the 5p cut coming back from January 2027. Pump prices also move with oil prices, which nobody can forecast.
- Work miles are trips for your job: visiting clients or customers, or travelling between sites. Your commute from home to your usual workplace doesn’t count.
- If you’re an employee and your employer pays less than the tax-free rate, you can claim tax relief on the difference from HMRC. If they pay more, the extra is taxed as pay.
- If you’re self-employed and use the mileage rates instead of your car’s actual costs, they come off your profit, saving Income Tax and National Insurance.
For who can claim and how, read using your own car for work: mileage rates and tax relief.
How the figures are worked out
Fuel: miles divided by miles per gallon gives gallons, and a gallon is 4.546 litres. Half a year’s litres, for January to June 2027, times 6p (the 5p cut and the 20% VAT on it) is the saving against the plan to bring the 5p back from January. The fuel duty you pay is 52.95p a litre plus 20% VAT on it, for petrol and diesel alike. The delayed inflation rise isn’t counted, since the Budget doesn’t say how big it would have been. Mileage: the tax-free amount for your work miles at 55p and 35p, against the 45p and 25p that would have come back without the Budget. For an employee, any part your employer doesn’t pay can be claimed as tax relief, and anything paid above it is taxed, so the saving is the Income Tax on the difference, at your rates. National Insurance on an employee’s mileage isn’t included. For the self-employed, the mileage comes off your profit, so the saving is the Income Tax and Class 4 National Insurance on the difference. Tax uses this year’s rates and bands, which stay frozen.
Where the figures come from
Every figure checked against the Budget document and GOV.UK on 28 October 2026.
- GOV.UK: Budget 2026: the fuel duty cut to 1 July 2027 and the mileage rates.
- GOV.UK: Excise duty hydrocarbon oils rates: 52.95p a litre for petrol and diesel.
- GOV.UK: Business mileage, the rules for tax: approved mileage rates and what’s taxed above them.
- GOV.UK: Tax relief for vehicles you use for work: claiming Mileage Allowance Relief.
- GOV.UK: Simplified expenses if you’re self-employed: the mileage rates for the self-employed.
Announced but not yet in force: the 35p rate above 10,000 miles from 6 April 2027 and the permanent 55p rate are due to be made law in the Finance Bill 2026-27. The fuel duty cut is set by the government and lasts until 1 July 2027.