Yes, self-employed people can claim petrol as a business expense — but not simply by keeping fuel receipts and deducting the total. HMRC gives you a choice between two different methods, and you cannot mix them for the same vehicle.
Method 1: Simplified mileage rate
This is the method most sole traders use. Instead of tracking fuel, insurance, servicing and depreciation separately, you claim a flat rate per business mile driven:
- 45p per mile for the first 10,000 business miles in the tax year
- 25p per mile for every business mile after that
This flat rate is deemed to cover fuel and all other running costs of the vehicle — you cannot then also separately claim petrol receipts on top of it. The appeal is simplicity: you only need to log your business mileage, not every fuel and maintenance receipt.
Method 2: Actual costs
Alternatively, you can claim the genuine business-use proportion of your actual running costs — fuel, insurance, repairs, servicing and capital allowances on the vehicle itself. This requires keeping every receipt and working out what percentage of your total mileage was for business versus personal use, then applying that percentage to each cost.
This method is more admin-heavy but can produce a larger deduction if you drive a higher-cost vehicle relatively few business miles.
Which should you choose?
Once you choose a method for a specific vehicle, you must generally continue using it for as long as you own and use that vehicle in the business — so it is worth estimating both for your first year of ownership before committing.
Track your business mileage automatically
Log trips at the correct 45p/25p rate and see your total vehicle deduction build up through the year.
Get the Free Mileage Log Sheet
Frequently asked questions
Can I claim both petrol receipts and mileage?
No. You must choose one method for a given vehicle and stick with it for as long as you use that vehicle in the business. Mixing fuel receipts with mileage claims for the same vehicle is not allowed.
Which method gives a bigger deduction?
It depends on your vehicle and mileage. The mileage rate tends to favour lower-cost, higher-mileage driving, while actual costs can work out better for an expensive vehicle with high running costs and lower annual mileage. Calculating both for your first year is the only way to know for certain.
Does this apply to vans as well as cars?
Yes, the same two methods (simplified mileage rate or actual costs) apply to vans used for business, though the simplified mileage rate itself is the same 45p/25p structure as cars.
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