Rachel Reeves changed the mileage allowance from 45p a mile to 55p a mile, backdated to April for the first 10,000 miles. What does this mean for you?

Let’s say you’ve driven 1,000 miles since April. The easiest thing to do would be to ask your employer to bank transfer you 1000 x 10p = £100 tax free. Note they have no obligation to do this.

If they do not, you can take a tax deduction for the £100. Assuming you are a higher rate taxpayer, this will give you £100 x 40% = £40 tax rebate.

If your employer continues to pay mileage at 45p a mile for the rest of the tax year, you can get a tax deduction for 10p per mile x number of miles driven at year end.