Germany pays 30 cents a kilometre, from the very first one

A British driver reading the German rules for the first time tends to notice two things: the number is smaller, and there is no 10,000 line to worry about.

The business rate

For a business journey in your own car, an employee in Germany can use a Kilometerpauschale of 30 cents per kilometre, either as a tax-free reimbursement from the employer or as a deduction on their own return for whatever the employer does not pay. Every kilometre, from the first, at the same rate. There is no threshold, no banding, and no annual reset to track.

The figure is not set by a tax circular that changes with fuel prices. It is anchored in law: § 9 of the income tax act (Einkommensteuergesetz) points at the highest travel allowance in the federal travel expenses act (Bundesreisekostengesetz), and that act sets 30 cents for a car. The payroll guidance, R 9.5 of the Lohnsteuer-Richtlinien, applies the same figure. Changing it means changing legislation, which is why it moves rarely.

At about 85p to the euro, 30 cents a kilometre is roughly 41p a mile once you convert both the currency and the distance. Britain's approved rate is 55p a mile for the first 10,000 business miles in the tax year, from 6 April 2026, so on those miles Britain is ahead. Above 10,000 miles Britain drops to 25p and Germany does not drop at all.

The commute is a different allowance entirely

This is the part that catches people out, and it is the opposite of the British approach.

In Britain, ordinary commuting between home and a permanent workplace is simply not claimable. It is outside the system.

In Germany, the commute has its own allowance, the Entfernungspauschale, and it works on different arithmetic:

• It counts the distance one way, not the round trip, for each working day you travel to your regular workplace
• From 1 January 2026 it is 38 cents for every kilometre of that one-way distance, from the first. From 2022 to 2025 it was 30 cents for the first 20 km and 38 cents from the 21st
• It applies regardless of how you travelled, including on foot or by train
• It is a deduction against income, not a tax free payment from an employer

So a German worker with a long commute gets something for it. A British worker with the same commute gets nothing. That is a genuine structural difference, not a rounding error.

Motorbikes, and the passenger question

The 30 cent figure is for a car. For a motorbike, scooter or other motor vehicle the travel expenses act sets 20 cents a kilometre, and that is the figure the tax rules then use.

Germany historically paid a supplement for carrying colleagues, the Mitnahmeentschädigung. The 2014 reform of the travel expense rules dropped it. There is no passenger supplement in the current German system.

Britain's passenger payment, up to 5p per passenger mile tax free if the employer chooses to pay it, is unusual internationally. Assuming something similar exists in Germany is a reliable way to overstate a German claim.

The two systems side by side

What it means for a record

The absence of a threshold makes the German log simpler in one respect: you never have to know your running total to value a journey. Every kilometre is worth the same, so a trip recorded in March is worth exactly what the same trip is worth in November.

It makes it harder in another. Because the commute has its own allowance with its own arithmetic, a German record has to separate business travel from commuting cleanly, and record the one way distance for the latter. Lumping them together loses the distinction the deduction depends on.

Milometry ships the German scheme, so a driver on it sees kilometres, euros and the 30 cent rate throughout, rather than a British rate wearing a euro sign.

Sources

• § 9 Einkommensteuergesetz: Werbungskosten, including the Entfernungspauschale and the business travel rate
• § 5 Bundesreisekostengesetz: Wegstreckenentschädigung
• Steueränderungsgesetz 2025, including the higher commuting allowance from 2026 (Bundesregierung)
• Ordinary commuting and private travel (490: Chapter 3), for the British comparison
• Travel, mileage and fuel rates and allowances (HMRC)
• Income Tax (Earnings and Pensions) Act 2003, section 230

General information for drivers in Germany and the UK, not tax advice. Rates change: check the current figure with the authority you are filing under.