- Country Information
- New Zealand
How is mileage reimbursement calculated in New Zealand?
In New Zealand, mileage reimbursement for business-related use of a personal vehicle is calculated based on rates published annually by the Inland Revenue Department (IRD). These rates reflect typical running and ownership costs associated with vehicle use and vary by fuel type and total kilometres driven.
2024–2025 IRD Mileage Rates
The IRD has released updated rates for the 2024–2025 income year, reflecting increased vehicle running costs—particularly due to rising fuel prices.
Mileage reimbursement is calculated using Tier 1 and Tier 2 rates:
| Vehicle Type | Tier 1 Rate<br>(first 14,000 km/year) | Tier 2 Rate<br>(over 14,000 km/year) |
|---|---|---|
| Petrol | $1.17/km | $0.37/km |
| Diesel | $1.26/km | $0.35/km |
| Petrol Hybrid | $0.86/km | $0.21/km |
| Electric | $1.08/km | $0.19/km |
Tier 1 rates include both fixed and running vehicle costs and apply to the first 14,000 km of total annual travel (including private use).
Tier 2 rates cover only running costs and apply to business kilometres beyond 14,000 km per year.
Requirements for Reimbursement
To be eligible for mileage reimbursement:
Travel must be directly related to approved business activity.
A log or supporting record must be submitted including:
Date of travel
Purpose of the trip
Origin and destination
Number of kilometres travelled
Prior approval from your manager is required.
Important Note
Horizons will apply the appropriate Tier 1 or Tier 2 rate based on the nature and volume of business travel, in line with IRD guidance.
For further details, please refer to the official rates: Kilometre rates 2024-2025
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