New Motability changes set to cut mileage and increase lease costs

29th May 2026

Motability scheme changes announced last November raise concerns for polio survivors because of a reduced mileage allowance and increased costs.

Around 890,000 people currently lease a vehicle through the Motability scheme, which is operated by Motability Operations. The package typically includes insurance, servicing, and breakdown cover, and is provided in exchange for a person’s mobility allowance.

From 1 July this year, the average annual mileage allowance will be reduced from 20,000 miles to 10,000 miles. For Wheelchair Accessible Vehicles (WAVs), the total allowance will drop from 100,000 miles over five years to 50,000. Any mileage driven beyond these limits will be charged at 25p per mile, or 21p per mile for WAV users. Existing leases will remain unchanged.

These changes follow the announcement by Chancellor Rachel Reeves in last November’s Budget, which confirmed the removal of VAT and Insurance Premium Tax reliefs on Motability vehicles. As a result, certain higher-end vehicle brands will no longer be eligible from July, and the average advance payment for a three-year lease is expected to rise by around £400.

Chief Executive Officer of The British Polio Fellowship commented “Motability was originally designed to support disabled people in maintaining independence and everyday mobility. Many users, including polio survivors, rely on the scheme because public transport is often not accessible. For them, the ability to make routine journeys is essential, and they’re worried these changes could limit that freedom.”

Other charities have also reported concerns about the upcoming mileage restrictions, which are expected to affect around 215,000 disabled people.

Reduced allowances may force users to carefully ration journeys for work, healthcare appointments, and social activities, and in some cases could mean giving up their vehicles entirely. The impact is expected to be greatest for those in rural areas or those who must travel long distances for specialist medical care.

Overall, the new tax changes affecting the Motability scheme are projected to increase average lease costs by around £1,100 from July 2026, although adjustments for new leases from July will reduce the average rise to about £400. While existing leases will not be affected, core elements of the scheme, such as insurance, servicing, maintenance, and UK breakdown cover will remain in place.