MilesheetThe 5p passenger rate is a British peculiarity
Carry a colleague on a business trip in Britain and there is an extra 5p a mile in it. Germany dropped its equivalent in 2014, and most countries never had one.
Update, April 2026: the UK approved rate for cars and vans rose from 45p to 55p a mile for the first 10,000 business miles. The 25p rate above that, and the 5p passenger payment, are unchanged. This post describes the position as it stood when it was written.
Most British drivers who could claim it do not. Most drivers elsewhere could not claim it if they wanted to.
What Britain offers
If you carry a colleague on a journey that is business travel for both of you, your employer can pay you an extra 5p per passenger per mile, tax free, on top of the approved mileage rate.
Two conditions do most of the work. The passenger has to be a fellow employee, so clients and family do not count. And the journey has to be business travel for them as well as for you, so a colleague you are dropping at home on the way does not qualify.
It is small money per journey and unremarkable per year unless you routinely travel in pairs. Four colleagues in one car on a 200 mile round trip is £30 of passenger payments on a journey already worth £90 in mileage.
The catch that makes it rare
Unlike the main rate, there is no relief mechanism behind it.
If your employer pays below the approved mileage rate, you can claim the shortfall yourself through Mileage Allowance Relief. If your employer does not pay the passenger supplement, that is the end of it. You cannot claim it on a return, and there is no shortfall to recover.
So the 5p only exists if your employer has chosen to operate it. Many have never been asked.
Almost nowhere else has one
Germany used to. The Mitnahmeentschädigung paid a supplement per passenger per kilometre, and the 2014 reform of the travel expense rules removed it. Current German rules carry no passenger supplement.
France, Spain, Ireland, Japan and the United States do not offer one either. The rate is the rate, whoever is in the other seats.
This matters if you drive for work in more than one country, or if you have moved. Assuming the 5p exists because it exists at home is a reliable way to overstate a foreign claim, and it is the kind of error that is invisible until somebody checks.
| Passenger supplement | |
|---|---|
| UK | 5p per passenger mile, employer's option |
| Germany | None since 2014 |
| France | None |
| Spain | None |
| Ireland | None |
| US | None |
| Japan | Whatever the employer's policy says |
Recording it
The reason the 5p goes unclaimed is rarely that people object to it. It is that nobody wrote down who was in the car.
The mileage is captured automatically by anything competent. The passengers are not, and cannot be: it is a fact about the journey that only the driver knows. If you intend to claim it, the passengers have to be recorded on the trip at the time, with the same discipline as the destination and the purpose.
Milesheet has a passengers field on the trip for exactly this, and includes the supplement in the claim where the scheme has one. On a scheme that does not, it stays out, because adding 5p to a German claim would be inventing money.
Sources
- Travel, mileage and fuel rates and allowances (HMRC)
- Expenses and benefits: business travel mileage, rules for tax (HMRC)
- § 5 Bundesreisekostengesetz: Wegstreckenentschädigung
General information, not tax advice. Check with HMRC or your accountant before relying on the passenger supplement.
