How reimbursement is calculated
Mileage reimbursement compensates someone for using a personal vehicle for work. Rather than tracking actual fuel, maintenance and wear separately, a single per-mile rate rolls all of those costs into one figure. The reimbursement is just the business miles driven multiplied by that rate.
The standard rate is set to approximate the full running cost of an average vehicle, which is why it is noticeably higher than fuel cost alone — it also covers depreciation, insurance, repairs and tyres spread across the miles.
About the standard rate
The default here is the 2024 IRS standard business mileage rate of 67 cents per mile. This rate is revised most years to track vehicle running costs, and different rates apply to medical, moving and charitable driving.
- Use the rate for the tax year in which the driving happened, not the current year.
- Employers may set their own rate; a company policy can pay more or less than the IRS figure.
- Only business miles qualify — commuting between home and a regular workplace generally does not.
- Keep a contemporaneous log of dates, destinations, purpose and odometer readings to support a claim.
Standard rate versus actual expenses
The per-mile method is one of two common approaches. The alternative is to total your real vehicle expenses for the year and deduct the business-use share. The standard rate is simpler and needs only a mileage log, while the actual-expense method can yield more for costly vehicles but demands receipts and careful record-keeping.
A note on accuracy
This calculator gives the gross reimbursement from miles and a rate; it is not tax advice. Rules on what counts as deductible business mileage, and how reimbursements are treated, vary by country and change over time. Confirm the current rate and eligibility with the relevant tax authority or a qualified adviser before filing.
Formula
reimbursement = miles × rateFrequently asked questions
- What is the IRS standard mileage rate?
- For 2024 it is 67 cents per mile for business use. Rates change yearly, so check the current figure for your tax year.