Ask what the official mileage rate is in the US and there's a number (72.5¢ this year). Ask in the UK and there's a number (55p). Ask in India and the honest answer is: there isn't one. No statutory ₹-per-kilometre figure exists for reimbursing employees who use their own vehicle for work. What exists instead is a two-part system — your employer's policy sets the rate, and the Income Tax Act decides whether the money arrives tax-free.
As always with Indian tax specifics: this is the map, not the territory. Edge cases (company-provided cars, driver salaries, mixed personal use) have their own valuation rules — confirm your situation with a CA.
The rate: whatever your employer's policy says
In practice, companies publish a per-km rate in their travel or conveyance policy, and the market clusters in a familiar range — commonly somewhere around ₹8–₹15 per kilometre for four-wheelers, less for two-wheelers, tuned to fuel prices and the city. Some firms pay actual fuel bills against receipts instead; some issue fuel cards. The per-km model survives because it's the cleanest: one number that covers fuel plus wear, no fuel-bill archaeology. Whatever your employer's number is, the mileage calculator takes it as an input — set the ₹/km, add the trips, and you have your claim.
The tax question: Section 10(14) and the word "actually"
Here's the part that matters more than the rate. Reimbursement for travel you actually performed for work is exempt from income tax under Section 10(14) of the Income Tax Act — it's treated as the employer covering a cost of doing the job, not as salary. But that word actually is load-bearing. The exemption attaches to documented official travel, not to a flat monthly allowance paid regardless of whether you drove anywhere.
That distinction shows up at two moments:
- In payroll. A fixed "conveyance allowance" credited every month with no supporting claims tends to get treated as taxable salary. Per-trip reimbursement against submitted claims keeps its exempt character.
- At assessment. If the exemption is questioned, what defends it is the record: when you travelled, where, why it was official, and how far. No record, and a reimbursement can be recharacterised as income — tax plus interest, at the least convenient time.
The logbook: the whole defence in four columns
The record doesn't need to be elaborate. Date, route (from–to), purpose, distance — kept as the trips happen, claim by claim. That's it; that's the document that separates "exempt reimbursement" from "disguised salary."
The failure mode is never the format — it's reconstruction. The claim deadline arrives, and suddenly someone is reverse-engineering three weeks of client visits from memory and Google Maps. If you want the spreadsheet version, the free mileage log template has the right columns with the reimbursement math built in (set the rate cell to your company's ₹/km). If you'd rather the log just existed, Starlog records each trip with its date, purpose, and distance as it happens and files it in your own Google Drive — alongside the fuel and toll receipts that belong to the same claim, export-ready for Tally when finance asks.
For the employer setting the policy
If you're the one writing the policy rather than claiming against it, the same logic applies from the other side: pick a defensible per-km rate, require the four-column log with each claim, and pay against claims rather than as a flat allowance. Your employees keep the exemption, and your books carry documentation instead of a question mark. (The same discipline pays off again at tax-prep time.)
The takeaway
India runs mileage on policy plus proof: the employer's ₹/km sets the amount, Section 10(14) makes it tax-free, and the logbook is what keeps it that way. Work out your claim with your company's rate, and start the log before you need it — the kilometres you can't document are the ones that turn into taxable salary.