Who pays for the commute: four countries, four answers

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.

The drive from your house to your usual place of work is the most common business-adjacent journey there is, and no two countries have decided the same thing about it.

Britain: it does not exist

HMRC's position is clean and unforgiving. Ordinary commuting, travel between your home and a permanent workplace, is private travel. It is not claimable, your employer cannot reimburse it tax free, and no amount of it counts towards the 10,000 mile threshold.

The interesting part is the exceptions, which is where the 24 month rule and the definition of a temporary workplace do the real work. Travel to a site you expect to attend for less than 24 months is business travel. Travel to the office you go to every day is not.

Germany: it has its own allowance

Germany reaches the opposite conclusion and builds a separate mechanism for it.

The Entfernungspauschale is a commuting allowance, deducted against income, and it works on arithmetic of its own: it counts the one way distance, not the round trip, and it applies whatever the mode of transport. Walk, cycle, drive or take the train, the allowance is the same, because it is compensating the distance rather than the vehicle.

That is a genuinely different philosophy. Britain says the commute is a private choice about where to live. Germany says it is a cost of being employed.

Japan: a monthly ceiling, banded by distance

Japan recognises the commute too, but through payroll rather than a deduction.

The National Tax Agency publishes a monthly ceiling on how much an employer can pay an employee, tax free, towards commuting. The ceiling is banded by the one way distance between home and work: further away, larger tax free allowance.

Two features surprise outsiders. It is a ceiling on the employer's payment rather than an entitlement, so an employer who pays nothing is doing nothing wrong. And there is a floor: very short commutes are taxable in full, on the reasoning that you could have walked.

America: personal, with unusual firmness

The IRS treats commuting as a personal expense, and says so more explicitly than most. Travel between home and a regular place of business is not deductible, and the guidance goes out of its way to close the obvious workarounds, such as carrying tools or making a business call on the way.

The American exceptions are similar in spirit to the British ones and turn on whether the workplace is temporary, and on whether you have a qualifying home office that makes the first journey of the day a business one.

The four, side by side

Why this matters to a log

If you drive in a country that recognises the commute, your record has to be able to tell a commute from a business journey, and to state the one way distance. If you drive in one that does not, it has to keep commuting out of the claim entirely.

Either way the requirement is the same: the log has to know which journeys were which, at the time, rather than have you decide in April. Milesheet handles this by letting you tag the places you go regularly, so home and your usual workplace are recognised and the drives between them are treated the way your scheme expects.

Sources

• Ordinary commuting and private travel (490: Chapter 3) (HMRC)
• § 5 Bundesreisekostengesetz: Wegstreckenentschädigung
• No.2585 マイカー・自転車通勤者の通勤手当 (National Tax Agency)
• Publication 463, Travel, Gift, and Car Expenses (IRS)

General information for drivers in the UK, Germany, Japan and the US, not tax advice. Check anything that matters with the authority you file under.