MilometrySpain reimburses 26 cents a kilometre, tax free
One flat figure, no bands and no threshold. Spain raised it from 19 to 26 cents in 2023, and it remains an employer payment rather than an employee claim.
Information générale, pas un conseil. Rédigé à titre d’information générale et exact à notre connaissance au 27 septembre 2026. Les règles fiscales changent et leur application dépend de votre situation. Ceci n’est pas un conseil fiscal, juridique ou financier : vérifiez auprès d’un expert-comptable, d’un conseiller fiscal ou de l’administration fiscale avant de vous y fier.
Spain has a single figure, which makes it easier to describe than France or Ireland. One rate, no bands, no threshold.
What changed: the exempt figure was 19 cents a kilometre until 17 July 2023, when Orden HFP/792/2023 raised it to 26 cents. This post was first written at 19 cents and has been rewritten at 26.
Twenty-six cents, tax free
Spanish employers can reimburse business driving in an employee's own car at 26 cents a kilometre free of income tax. Anything the employer pays above that is treated as pay and taxed accordingly. Tolls and parking can be reimbursed on top, against receipts.
The mechanism is clean and the arithmetic is simple. One rate, no bands, no threshold, no annual reset to track.
What that means in practice
At about 85p to the euro, 26 cents a kilometre works out at roughly 36p a mile once you convert both the currency and the distance. The exchange rate moves, so treat that as a rough guide. Britain's approved rate for cars and vans is 55p a mile for the first 10,000 business miles in the tax year and 25p after that, for journeys from 6 April 2026.
For a Spanish employee, the consequence of a low figure is not that a claim is disallowed. It is that the exempt ceiling may not cover the cost. An employer who wants to pay more than 26 cents can, but everything above 26 cents is taxed as salary.
The 19 cent figure stood unchanged for many years before the 2023 rise, through a period in which fuel and most other running costs went up. That was the grievance behind the campaign to raise it, and a good illustration of why an unmoved rate is not a neutral thing: a rate that stands still while costs rise is a cut, applied quietly.
The structure is still worth understanding
Two features of the Spanish system are worth knowing.
Receipts matter. Tolls and parking on evidence are reimbursed separately, and on a toll motorway they can be a meaningful part of what a Spanish driver is paid back.
The exemption is the employer's to apply. This is a payroll mechanism. It governs what your employer can pay you without deducting tax, rather than a deduction you claim on a return. If your employer pays nothing, there is no Spanish equivalent of Britain's Mileage Allowance Relief to fall back on.
That last point is easy to miss for British drivers working in Spain, who may expect to get tax relief on the shortfall themselves.
Side by side
| Spain | UK | |
|---|---|---|
| Exempt rate | 26 cents per km | 55p per mile, then 25p |
| Roughly, per mile | About 36p (at about 85p to the euro) | 55p on the first 10,000 miles |
| Bands | None | One step at 10,000 miles |
| Last changed | 17 July 2023 (from 19 cents) | 6 April 2026 (from 45p) |
| Tolls and parking | Separately, on receipts | Separately, on receipts |
| Employee relief on a shortfall | No equivalent mechanism | Yes, Mileage Allowance Relief |
Recording it
Milometry has a Spain scheme built in at 26 cents a kilometre, with kilometres and euros throughout. If your employer pays a different figure, you can record what they actually pay alongside it and see both.
Seeing both is the useful part. The gap between what a journey cost and what it was reimbursed at is the number worth having, and it is invisible unless something is keeping the log.
Sources
- Asignaciones para gastos de locomoción (Agencia Tributaria)
- Orden HFP/792/2023, which raised the figure to 26 cents from 17 July 2023 (BOE)
- Travel, mileage and fuel rates and allowances (HMRC), for the British comparison
- Increasing mileage rates (HMRC policy paper), the 55p rate from 6 April 2026
General information for drivers in Spain and the UK, not tax advice. Check the current exempt figure with the Agencia Tributaria or your asesor.
