HMRC December Driving Law Changes: Key Updates for UK Drivers

Introduction

Every December, HM Revenue and Customs introduces updates to motoring tax rules, mileage allowances, and fuel rates. These changes shape how UK drivers claim mileage, how company cars are taxed, and how electric vehicle (EV) charging is reimbursed.

Even if you’re not a business driver, the updates matter. They can affect:

• Employees claiming mileage allowance.

• Self-employed drivers recording business travel.

• Company car users facing new Benefit-in-Kind (BIK) tax bands.

• EV owners looking for clarity on charging reimbursement.

This guide breaks down the December 2025 driving law changes, explains their impact, and shows UK drivers how to stay compliant.

What are the main HMRC December driving law changes UK drivers need to know?

The December updates include:

• Mileage Allowance Rates – increases for cars, vans, motorcycles, and bicycles.

• Company Car Tax Bands – adjusted to reflect WLTP emissions standards.

• Advisory Fuel Rates (AFR) – new rates for petrol, diesel, hybrid, and electric cars.

• Electric Vehicle Charging Rules – clearer guidance on tax-free reimbursement.

• Penalties for Non-Compliance – stricter fines for inaccurate mileage or reporting.

How do the HMRC December driving law changes affect mileage claims?

Mileage claims are one of the most common areas where HM Revenue and Customs (HMRC) identifies mistakes. The December update brings:

• Higher mileage allowance rates for the first time in years.

• Different rates depending on distance (above or below 10,000 miles).

• Stronger requirements to keep accurate mileage logs.

What is the updated mileage allowance rate for 2025?

Example:

• Old rate: 10,000 miles × 45p = £4,500.

• New rate: 10,000 miles × 47p = £4,700.

• That’s a £200 increase for the same mileage.

How do the December changes impact fuel reimbursement and company cars?

What are the new Advisory Fuel Rates (AFR)?

AFR are used by employers to reimburse employees for business travel fuel. Updates include:

• Petrol AFR increased slightly due to higher pump prices.

• Diesel AFR decreased for smaller engines as efficiency improved.

• EV AFR rose from 9p to 10p per mile.

What are the new rules for electric vehicle mileage and charging?

EVs now have a clearer framework:

• Home charging → Reimbursed at actual cost (with evidence).

• Workplace charging → Tax-free if provided by employer.

• Public charging → Reimbursed tax-free up to AFR (10p/mile).

Sarah Greene, tax adviser, comments:

“The clarification on EV charging rules removes confusion and ensures both employers and employees understand what can be reimbursed.”

How do the December HMRC changes affect self-employed drivers?

Self-employed drivers can also use the new mileage rates. Two main methods apply:

• Simplified Expenses (Flat Rate) – Use HMRC’s mileage allowance rates (47p for cars up to 10,000 miles).

• Actual Costs Method – Claim a proportion of running costs: fuel, insurance, repairs, servicing, and MOT.

Example:
A self-employed courier drives 12,000 miles in 2025.

• 10,000 miles × 47p = £4,700

• 2,000 miles × 27p = £540

• Total claim: £5,240

This saves time compared to logging every individual cost.

What penalties apply under the new December HMRC driving law changes?

HMRC is cracking down harder on false mileage and reporting errors.

• Over-claiming mileage → Repayment + penalty of up to 100%.

• Incorrect P11D reports → Up to £3,000 fine per car.

• Poor record-keeping → Treated as negligence, leading to higher penalties.

How can UK drivers stay compliant with the HMRC December driving law changes?

What practical steps can drivers take to avoid HMRC penalties?

• Log mileage properly – Date, purpose, start and end odometer readings.

• Digitise records – Apps like MileIQ or Tripcatcher help automate tracking.

• Keep receipts – Fuel, public charging, or home electricity evidence.

• Check quarterly updates – AFR can change every 3 months.

• Stay transparent – Avoid inflating claims or omitting details.

HMRC Driving Law Changes (Before vs After December 2025)

Why do HMRC December driving law changes matter for everyday motorists?

Even if you never claim mileage, these changes still affect you:

• Company car drivers – Tax incentives favour low-emission vehicles.

• EV owners – Reimbursement clarity makes charging cheaper.

• General compliance – HMRC and DVLA are sharing more data, so incorrect car details can trigger checks.

The changes are not just about “tax rules” — they shape everyday motoring costs and choices.

How much can drivers save under the new rules?

That’s £240 more tax-free allowance in 2025 for the same mileage.

What are the 7 new driving rules in December 2025?

Alongside HMRC’s tax-related updates, seven broader motoring laws come into effect across the UK:

1. Stricter mobile phone ban – Even touching a phone while driving (including to check maps or notifications) can now lead to £200 fines and 6 penalty points.

2. Tighter seatbelt laws – Police given more power to issue on-the-spot fines if passengers fail to wear seatbelts.

3. Expanded clean air zones – More UK cities will introduce or expand ULEZ-style zones, with daily charges for high-emission vehicles.

4. Changes to parking regulations – Councils now have more authority to issue fines via CCTV and ANPR.

5. New learner driver rules – Learners can practise on motorways with dual controls and approved instructors only.

6. Tougher drink and drug-driving enforcement – More roadside saliva tests introduced, with immediate licence suspension if positive.

7. Increased speed camera use – Wider deployment of average-speed cameras on both motorways and rural roads.

What are the changes for seniors in the UK driving law 2025?

Older drivers are a growing group on UK roads, and new rules in 2025 introduce changes:

• Medical renewals at 70+ – Drivers must continue renewing their licence every three years, but now HMRC and DVLA will share medical data to speed up checks.

• Mandatory eyesight tests – Over-70s will need to provide proof of regular eyesight tests when renewing.

• Awareness campaigns – DVLA launching more support for older drivers to keep safe mobility for longer.

• Stricter assessments after incidents – If a senior driver is involved in a crash, DVLA may require a medical or driving fitness assessment.

What are the new rules for speeding in 2025?

Speeding remains one of the most common motoring offences in the UK, and new enforcement measures are rolling out in December 2025:

• Lower tolerance levels – Police forces are reducing the “10% + 2 mph” tolerance in some regions. In many areas, drivers can now be fined at just 1 mph over the limit.

• Harsher penalties in 20 mph zones – With more cities adopting 20 mph urban limits, fines and points have been doubled for violations.

• Smart speed cameras – New AI-powered cameras detect not only speeding but also mobile phone use and seatbelt offences simultaneously.

• Repeat offender penalties – Drivers caught speeding three times in two years could face automatic licence suspension.

Conclusion

The HMRC December driving law changes in 2025 introduce higher mileage allowances, updated fuel and EV charging rates, and stricter penalties for inaccurate claims. UK Self-employed drivers and company car users alike must pay closer attention to record-keeping and compliance to avoid fines.

Beyond HMRC, wider motoring rules bring tighter speeding enforcement, new requirements for senior drivers, and expanded clean air zones across UK cities. These updates are designed to improve safety, cut emissions, and modernise driving standards. For motorists, the best approach is to stay informed, keep clear mileage logs, and adapt quickly to the new framework so they can save money while staying on the right side of the law.

FAQs on HMRC December Driving Law Changes

What is the new HMRC mileage rate from December 2025?

The rate for cars and vans is now 47p per mile for the first 10,000 miles and 27p thereafter.

Do the December driving law changes affect electric car owners?

Yes. AFR increased to 10p per mile, and clearer rules now cover home, workplace, and public charging.

What happens if I overclaim mileage under the new rules?

You’ll need to repay the excess and could face a penalty up to 100% of the overclaimed amount.

How do company car drivers benefit or lose from the December HMRC updates?

Drivers of low-emission vehicles may pay less Benefit-in-Kind tax, while high-emission car drivers could pay more.

Can self-employed drivers claim the same mileage rates as employees?

Yes, self-employed drivers can use the simplified mileage rates or actual costs method.