What are the IRD kilometre rates for 2025-26?
Petrol pays 120 cents per kilometre for the first 14,000 kilometres, then 37 cents per kilometre. Diesel, hybrid, and electric vehicles have their own pairs, because their running costs differ.
IRD mileage hub
Inland Revenue
New Zealand Mileage Tools
Use IRD kilometre rates and a tier-aware calculator for business vehicle expense claims in New Zealand.
Petrol2025-26
120 cents per kilometre
for the first 14,000 kilometres, then 37 cents per kilometre
Source: IRD kilometre rates 2025-26
Country rates by MileagePilotUpdated Oct 15, 2026
IRD rates in force
The kilometre rates for the 2025-26 income year, by vehicle type. Tier 1 carries the vehicle's fixed costs as well as its running costs; tier 2 carries running costs only.
2025-26
In force| Trip or vehicle | Rate | Source |
|---|---|---|
| Petrol | First 14,000 km · 120 cents per kilometre; After 14,000 km · 37 cents per kilometre | IRD kilometre rates 2025-26 |
| Diesel | First 14,000 km · 130 cents per kilometre; After 14,000 km · 38 cents per kilometre | IRD kilometre rates 2025-26 |
| Hybrid | First 14,000 km · 90 cents per kilometre; After 14,000 km · 24 cents per kilometre | IRD kilometre rates 2025-26 |
| Electric | First 14,000 km · 122 cents per kilometre; After 14,000 km · 23 cents per kilometre | IRD kilometre rates 2025-26 |
What decides the figure
- Tier 1 applies to the first 14,000 kilometres the vehicle travels in the income year, and that distance includes private travel as well as business travel.
- Tier 2 applies to everything beyond 14,000 kilometres, which is why the second rate is much lower.
- The rate depends on the vehicle type: petrol, diesel, hybrid, or electric.
- The rate prices the kilometres, not the share of them that was for business. A logbook sets that share, and the deduction is the business share of the total.
- The same rates are used to work out the tax-exempt part of a reimbursement an employer pays for business use of an employee's own vehicle.
IRD rates by year
IRD publishes each year's rates after the income year ends on 31 March, so a rate set arrives the year after the income year it prices.
2025-26
Petrol · 120 cents per kilometre -> 37 cents per kilometre
2024-25
Petrol · 117 cents per kilometre -> 37 cents per kilometre
Start with your case
New Zealand publishes one set of rates and two ways to apply them, and the newest set is not always the one a claim needs.
You are working out the deduction
Enter the vehicle type and the year's travel to see both tiers applied, then apply your business-use share from the logbook.
Kilometre rate calculatorYou are claiming an earlier year
A return for an earlier income year uses that year's published rates, not the newest set.
IRD km rate 2024-25You are waiting on the next set
The tracker follows the next income year's rates and states what stays in force until IRD publishes them.
IRD km rate 2026-27What the record has to show
The rate is only half the calculation. The other half is the share of the vehicle's travel that was for business, and that comes from a logbook.
- A logbook covering at least 90 consecutive days, with the odometer reading at the start and end of the period.
- For each business journey: the date, the distance, and the reason for the trip.
- The vehicle's total distance for the income year, so the business share can be worked out.
How long to keep it
Keep the records for seven tax years.
The seven-year retention rule and what counts as a record.
Source: IRD: record keeping
Common questions
What is the 14,000 kilometre threshold?
Tier 1 applies to the first 14,000 kilometres the vehicle travels in the income year, and private travel counts towards that distance. Beyond it the rate drops to tier 2, which covers running costs without the fixed costs of ownership.
Do I need a logbook?
Yes. The rates price the kilometres; a logbook shows what share of them was for business. IRD accepts a logbook kept over at least 90 consecutive days, with the odometer read at both ends of the period.
Can I claim actual costs instead?
Yes. Kilometre rates are one way to work out the business share of vehicle costs. Keeping the actual running costs and applying the same business-use proportion is the alternative, and it needs the receipts behind those costs.
How long do I keep the records?
Seven tax years, including records stored electronically. The obligation continues after a business stops trading, for the years it was trading.
Official references
- IRD: claiming vehicle expenses
The kilometre rates by vehicle type, and the tier thresholds.
- IRD: use a logbook
The 90-day logbook and the business-use proportion.
Explore New Zealand
Every IRD page on the site: the rates in force, the calculators that price them, and the templates that support a claim.