In a significant update for UK workers, Chancellor Rachel Reeves has announced an increase in tax-free mileage rates for employees using personal vehicles for business purposes. The new rate will rise from 45p to 55p per mile, applicable to the first 10,000 miles driven in a tax year, with a reduced rate of 25p for any additional miles. This change, effective from April 2026, is aimed at supporting workers such as carers and tradespeople who rely on their vehicles for work-related travel. Martin Lewis, a financial expert, praised the increase as a vital adjustment, noting that the previous rate had been stagnant since 2011. The announcement follows advocacy from trade unions, particularly Unison, which has campaigned for this long-overdue change. General secretary Andrea Egan emphasized that this adjustment will provide immediate financial relief to many frontline workers facing escalating living costs. The new rates also include 24p per mile for motorbikes and 20p for bicycles, ensuring broader support for various modes of transport used in work settings.