When leasing a car through a Personal Contract Hire (PCH) agreement, you’ll be asked to choose an annual mileage allowance. But what happens if you go over it?
This guide explains how excess mileage charges work, how they’re calculated, and how you can manage or avoid them.
Excess mileage is the additional distance you drive beyond the total mileage limit agreed in your lease contract. If you exceed this limit, you’ll be charged a per‑mile fee at the end of your agreement.
These charges are designed to cover the vehicle’s increased depreciation due to higher mileage.
Your mileage limit is calculated over the entire term of the lease, not per year.
Example:
3-year lease at 10,000 miles per year = 30,000 miles total
2-year lease at 8,000 miles per year = 16,000 miles total
Mileage is only checked at the end of the contract when the vehicle is collected.
Every PCH lease includes an agreed excess mileage rate, typically ranging from 3p to 30p per mile (including VAT). The rate depends on the make/model of the vehicle and the funder.
Contracted total mileage: 30,000 miles
Actual mileage: 32,500 miles
Excess: 2,500 miles
Charge rate: 6p per mile
Total excess mileage charge: 2,500 × £0.06 = £150
Yes — and they’re easy to manage if you monitor your usage throughout the lease. Here’s how:
If you exceed your total mileage:
You’ll receive a final excess mileage invoice after the vehicle is returned
Charges are added to your end-of-lease bill
The vehicle must still meet Fair Wear & Tear standards separately from mileage
There are no refunds for unused miles.
If you think you’re going over your allowance, or want to explore amending your contract, our team is here to help.