Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what recent comparative assessment her Department has made of the adequacy of the (a) Approved Mileage Allowance Payment rate for self-employed people and (b) average vehicle running costs.

Approved Mileage Allowance Payments (AMAPs) are used by employers to reimburse an employee’s expenses for business mileage in their private vehicle. These rates are also used by self-employed drivers to claim tax relief on business mileage (simplified motoring expenses).

The Government keeps the AMAP rates under review and HMRC use a variety of information in estimating typical motoring costs per business mile. This includes information from the AA, the National Travel Survey, the Association of British Insurers, and the Department for Energy Security and Net Zero.

The AMAP rates are intended to reflect both running costs, such as fuel, and a proportion of standing costs, such as insurance, MOT, and depreciation. In estimating typical motoring costs per business mile, the Government must therefore consider the weighting given to each component and how to apportion certain costs.