Sole trader · Self-employed · HMRC 2026/27
Sole trader mileage log: track Tesla business miles for HMRC
If you use your own Tesla for a sole-trader business, the tax calculation can be simple. The difficult part is keeping a reliable record of which miles were genuinely business mileage.
For 2026/27, HMRC's simplified vehicle expense rate for cars and goods vehicles is 55p per business mile for the first 10,000 miles and 25p for each business mile after that. A Tesla uses the same car rate as other cars. The tax rule is based on business mileage, not the car's total mileage.
1. What can a sole trader claim for business mileage in 2026/27?
HMRC allows eligible self-employed people to use simplified expenses for vehicle costs instead of working out the business share of actual running costs. For cars and goods vehicles in tax year 2026/27, the rates are:
First band
55p per mile
For the first 10,000 qualifying business miles in the tax year.
After 10,000
25p per mile
For each qualifying business mile above the first 10,000.
The 55p first-band rate increased from 45p with effect from 6 April 2026. The change was announced on 21 May 2026 and applies retrospectively from 6 April 2026.
2. Example: 12,000 business miles in a Tesla
Tax year 2026/27
12,000 business miles
The first 10,000 and the miles above the threshold use different rates.
First 10,000
£5,500
10,000 × £0.55
Next 2,000
£500
2,000 × £0.25
Total simplified vehicle expense: £6,000. This is a deduction used when calculating taxable business profit, not a £6,000 payment from HMRC.
3. Which Tesla journeys count as business mileage?
Only mileage that is genuinely part of the business should enter the calculation. The destination alone does not always decide the tax treatment; the purpose and working pattern matter.
A Tesla can tell you where the car moved. It cannot know why you made the journey. DriveQuery can suggest a category from recurring routes, but the sole trader should confirm the purpose where tax treatment depends on context.
4. HMRC expects records of the business miles
HMRC's simplified-expenses guidance tells self-employed users to keep records of their business miles. HMRC's Business Income Manual also stresses the importance of a contemporaneous record of business mileage where the mileage-rate method is used.
If you want the trip capture to be less manual, see the mileage tracker app for Tesla business journeys. The HMRC mileage rates calculator then gives a quick 55p/25p calculation for qualifying miles.
A useful mileage record should therefore keep the factual trip information together with a business-purpose label:
- Date
- Start and end locations
- Distance
- Purpose of the journey
- Business / commute / private classification
- Any note needed to explain an unusual trip
The result should be a record that can be reviewed line by line rather than a total reconstructed at the end of the tax year. A simple month might look like this:
| Date | Route | Purpose | Class | Miles | Status |
|---|---|---|---|---|---|
| 4 Aug | Home → Client A | Project meeting | Business | 31 | Confirmed |
| 4 Aug | Client A → Supplier | Collect equipment | Business | 12 | Confirmed |
| 5 Aug | Home → regular workplace | Normal workday | Private / commute | 18 | Confirmed |
| 7 Aug | Home → new destination | Not entered yet | Unclassified | 24 | Needs review |
Illustrative example only. The tax treatment depends on the facts of the journey and the business.
5. Simplified mileage or actual vehicle costs?
Simplified mileage is not the only way a sole trader can calculate vehicle expenses. Depending on the circumstances, the alternative is to work out the allowable business proportion of actual vehicle costs and relevant capital allowances.
HMRC also applies an important consistency rule: once the flat mileage-rate method is used for a particular vehicle, it generally has to continue for that vehicle while it remains in the business. You cannot simply switch methods each year to whichever produces the larger deduction.
6. A Tesla makes the record-keeping unusually automatable
The administrative problem is usually not the multiplication by 55p. It is rebuilding six months of journeys from memory. DriveQuery can continuously collect available journey data through the Tesla connection — including times, distances and location context — to create a factual starting point for review.
DriveQuery's workflow is intended to be:
- Client and supplier visits
- Travel between business locations
- Purpose confirmed
- Personal journeys
- Ordinary home-to-work travel
- Excluded from the business-mile claim
- New destination
- Unclear working pattern
- Purpose missing or unusual
7. Watch the 10,000-business-mile threshold automatically
The threshold is easy to miss if mileage is spread across the year. A useful dashboard can show exactly where the sole trader is in the tax year:
Business mileage
8,420 / 10,000 miles
1,580 miles remain in the 55p band.
Estimated simplified expense
£4,631
8,420 × £0.55
Needs review
4 journeys
New routes have not yet been confirmed as business or private.
8. What if you use more than one vehicle?
The detailed mileage-rate rules can depend on the vehicle and accounting circumstances. Keep records by vehicle and do not assume that buying or changing a Tesla automatically creates a fresh tax opportunity. If the business has already used capital allowances or actual-cost treatment for a vehicle, simplified mileage may not be available for that vehicle.
DriveQuery workflow
Turn Tesla trip history into a business-mileage record.
Capture the journeys automatically, confirm the reason for each business trip and keep the 10,000-mile threshold visible throughout the tax year.
Frequently asked questions
What is the sole trader mileage rate for 2026/27?
For cars and goods vehicles using HMRC simplified expenses, the rate is 55p per business mile for the first 10,000 qualifying miles in tax year 2026/27 and 25p for each business mile above 10,000.
Does the 55p rate apply to a Tesla?
Yes. The simplified-expenses car rate is not lower because the car is electric.
Can I claim electricity and servicing as well as 55p per mile?
Not as duplicate vehicle costs under the simplified mileage method. The flat mileage amount replaces the normal motoring-cost calculation for that vehicle, subject to HMRC's detailed rules.
Do I need a mileage log?
HMRC tells self-employed users of simplified vehicle expenses to keep records of their business miles. A contemporaneous mileage record is the safest way to support which journeys were included in the claim.
Does driving from home to my normal place of work count as business mileage?
Ordinary home-to-work travel is normally private. The exact treatment can depend on how and where the business is carried on, so unusual working patterns should be checked against HMRC guidance or professional advice.
Can I switch from actual vehicle costs to simplified mileage for the same Tesla?
Not automatically. HMRC says simplified vehicle expenses cannot be claimed for a vehicle if you have already claimed capital allowances for it or included it as an expense when calculating business profits. Check the history of that specific vehicle before changing method.
Sources: GOV.UK – Simplified expenses: vehicles, HMRC – 2026/27 mileage-rate increase, HMRC Business Income Manual – simplified vehicle expenses and GOV.UK – simplified expenses checker.
Make sole-trader mileage a review task, not a reconstruction task.
DriveQuery is being built to capture Tesla journeys continuously, learn recurring categories and leave only uncertain trips for you to confirm.