How to charge for travel time as a contractor in 2026

Figuring out how to charge for travel time as a contractor is one of those pricing decisions most solo tradespeople put off too long. You're driving 20–40 minutes each way to some calls, burning fuel and time, but your quote doesn't reflect it—so you absorb the cost. This post gives you three workable methods for billing travel time, a zone-based fee template built for service trades, and a short script for explaining the charge to new customers without losing the booking.

Why you can't afford to absorb travel costs

Your truck isn't free. The IRS sets the standard business mileage rate at 72.5 cents per mile for 2026—up 2.5 cents from 2025, per the IRS official rate announcement. That rate covers fuel, oil changes, tires, insurance, and vehicle depreciation. It does not cover your time behind the wheel.

A 15-mile service call—30 miles round trip—costs you $21.75 in vehicle expense alone at that floor rate. Add 30 minutes of your labor at a typical service rate and that single drive runs $50–$70 in combined cost before you've touched a single tool.

If you've already run the numbers on your minimum floor rate—we walk through the full math in how to calculate your minimum hourly rate as a solo contractor—you know that every unpaid hour erodes the margin meant to cover your insurance, estimated taxes, and slow weeks. Travel is a legitimate operating expense, and you need a consistent policy for it before a customer question forces an awkward on-the-spot answer.

Three ways to charge for travel time

There's no single right method. The best one depends on how wide your service area is and how price-sensitive your typical customer tends to be.

1. Roll it into the service call fee. You charge a single flat line item—"Service call: $95"—that covers the first 30 minutes of travel plus initial diagnosis. This is the most common structure in residential trades because homeowners understand a flat show-up fee. It works well when you stay within a 15–20-mile radius and your drive times are predictable. For what service trades typically charge, see our breakdowns of HVAC service call pricing and plumbing service call pricing.

2. Separate line item at 50–75% of your hourly rate. If your labor rate is $120/hr, you bill $60–$90/hr for documented travel time. This approach is fully transparent and recovers every minute on the road. Commercial and property-management clients tend to accept it without question; residential homeowners sometimes push back on a visible travel line they weren't expecting.

3. Per-mile charge above a threshold. You charge nothing within a set radius—commonly 15 miles—and then a flat fee per mile beyond that, typically $1.00–$1.50/mile as a starting point. The IRS rate of 72.5¢/mile is the absolute floor since it covers vehicle costs only, not your time, so any markup above it is justified.

Before locking in a number, run the full job math through the markup calculator to confirm your all-in price—labor, parts, travel, and overhead—still generates the margin you need.

Zone-based pricing: a practical template

Zone pricing is the most scalable structure for residential service contractors who want consistent travel fees without tracking exact mileage on every call. You define concentric rings around your base, assign a flat fee to each ring, and list it on every estimate. Customers see the full price before you dispatch.

Here's a starting template. These numbers are a reasonable starting point based on the vehicle cost math above—adjust the mileage bands to your actual service area and trade:

A few notes on making this work in practice:

• Measure from your shop or home, not a city center. Where your truck starts each morning is the right origin.
• Review Zone 3 calls before accepting. A 40-mile dispatch for a low-ticket repair—a thermostat swap, a leaking shut-off—may cost you more in combined travel and lost billing time than the job is worth.
• In dense urban areas, replace mileage rings with named ZIP codes or neighborhoods. Customers understand geography better than radius calculations and it avoids arguments when traffic adds miles.
• Review annually. When the IRS publishes its updated mileage rate each December, check whether your zone fees still cover your actual vehicle costs.

Can you legally charge for travel time?

Yes. As a self-employed contractor or sole proprietor, you're not subject to the federal Portal-to-Portal Act—the law governing when employers must compensate W-2 employees for travel to and from job sites. Your pricing is entirely your own business. A travel fee is simply a term in your service agreement, and no law requires you to transport yourself to customers at your own expense.

The one practical rule: disclose the fee before work begins. State it clearly in your written estimate, list it as its own line item, and get written acceptance before you dispatch. A travel fee that shows up for the first time on a final invoice is a reliable recipe for chargebacks, disputes, and one-star reviews. None of that is worth the amount involved.

Some contractors worry that listing a travel fee will cost them jobs in competitive markets. That tradeoff is real. But customers who refuse a $40 trip charge for a 25-mile drive are usually the same customers who dispute every invoice and argue about warranty callbacks. Filtering your service area by charging for distance is a legitimate business decision.

How to explain a travel fee to customers

Most residential customers have never been told why distance costs money on a service call. A brief, confident explanation handles most pushback before it forms.

Here's a script that works across trades:

"My service call fee covers your home visit. For jobs outside my core area, I add a travel fee to cover the drive—it's on your estimate as its own line so you see the full total before I head out."

A few things that make the conversation easier:

• Mention it at booking, not invoice time. "The job's in Millfield—that puts you in Zone 2 for me, so there's a $40 travel fee on top of the service call. Does that work?" Almost all customers say yes immediately. The ones who don't would have balked at the invoice anyway.
• List it as a specific line on the estimate. "Travel fee—22 miles: $40" reads as professional. Customers trust a contractor who shows their math rather than lumping costs into a vague total.
• Offer a loyalty credit if your market warrants it. Crediting the travel fee toward a repeat visit booked within 90 days turns a friction point into a retention mechanism. Not every contractor does this, but it's worth testing if you do repeat work in distant zones.

If a customer points out that a competitor "doesn't charge travel," the honest answer is: either the cost is buried in their hourly rate, or they're eating the margin. You're not more expensive—you're just transparent about where the number comes from.

Takeaways

• The IRS standard business mileage rate for 2026 is 72.5¢ per mile—use it as a cost floor for vehicle expense calculations, not a ceiling. It covers fuel, oil, insurance, and depreciation, but not your labor time.
• Three billing methods: build travel into the service call fee (simplest for residential), bill it as a separate line at 50–75% of your hourly rate (most transparent for commercial), or charge per mile above a threshold (best for wide service areas).
• Zone-based pricing—flat fees by mileage ring—is the most scalable structure for residential service trades and eliminates per-call mileage tracking.
• Disclose any travel fee on the written estimate before you dispatch. A fee that appears only on the final invoice costs more in dispute time than it collects.
• Review your zone fees each January when the IRS updates the mileage rate.

Tracking whether your travel fees actually protect your margin

Setting a fee is step one. Knowing whether it's working—whether your Zone 3 calls actually generate the margin you expect after accounting for drive time—is step two, and most solo contractors skip it.

Once you're logging job costs alongside your estimates, you can see which distant calls are profitable and which are quietly eroding your weekly take-home. A JobEstimator account tracks labor, parts, and your quoted rates together in one place so the comparison happens automatically. Plans start at $39/month—less than the cost of a single unprofitable long-haul service call in most trades. If you've been running Zone 3 work and wondering where the margin goes, the answer is usually two or three calls a month that looked fine on the surface.