The objective of this blog post is to explain the recent update to New Zealand mileage reimbursement rates announced by the local tax authorities as part of professional expense regulations.

The Inland Revenue Department (IRD) has announced updated kilometre rates for the 2025-2026 income year. These rates are for businesses to use when calculating deductible expenses for the business use of a vehicle under the kilometre rate method.

To ensure compliance, users of SAP Business Bydesign are required to review local tax guidance and update their internal expense policies accordingly.

SAP Business ByDesign system provides a configurable option that allows customers to maintain such statutory mileage reimbursement rates for New Zealand in Business Configuration.

Steps to Update Mileage Reimbursement Rates

To reflect the updated mileage reimbursement rates, customers can maintain the configuration as follows:

1. Navigate to Business Configuration > Overview Search for the activity > Mileage Rates – New Zealand
2. Open Edit mileage reimbursement rates
3. Select the ‘Statutory Rates' tab > Click Add Row > Maintain Miles or Km limit and maintain per Km rate with applicable effective rates.
4. Click Save to activate the changes

By updating the mileage reimbursement configuration, SAP Business ByDesign customers in New Zealand can ensure compliance with local regulations while maintaining accurate and auditable expense reporting.

Legal Source:
Kilometre rates 2025-2026

Thanks & Regards

Kartik Bist