What expenses can be declared as a private hire driver?
If you are a private hire taxi driver or are thinking about becoming one, it’s really useful to know what expenses you will be able to declare and not declare when completing your self-assessment tax form. This is because you will want to ensure you’re making the most of any tax breaks available to you.
Costs linked to your actual taxi
As a private hire driver, you can also include the costs that are linked to your actual taxi. For example, if you purchased your taxi with a personal loan, bank loan or on a credit card, you will have the opportunity to state the interest amount on this loan as an expense.
If you have been subject to any registration fees, these can also be claimed against. For example, you may be required to pay license fees. Drivers working in London will likely have to account for the cost of their PCO license. Also, it’s worth noting that AA/RAC breakdown cover memberships are both eligible expenses that can be claimed against too. If you don’t have standard taxi cover, not to worry as Uber car insurance can also be added as an expense.
Office expenses and administration costs
Registering with HM Revenue & Customs
If you are required to complete a tax return, you will need to start by informing HM Revenue & Customs (HMRC). There are two separate forms that can be used. Although, as a private hire taxi driver, you will most likely be required to select the one for those who are newly self-employed. Fortunately, most HMRC registrations can now be completed online through the government website.
These forms will ask you to enter your personal information such as full name, date of birth and address etc. You will also need to enter in your National Insurance (NI) number and provide up-to-date contact information such as your telephone number and email address.
Once you have done this, HMRC will send you a confirmation of your registration and provide you with your unique taxpayer’s reference (UTR) number.
Tax return basics
Your self-assessment tax return should disclose any taxable income for the relevant tax year. The new tax year starts on 6 April and ends on the following 5 April each year. If you do other work as a taxi driver such as food delivery, this will also need to be included. Thankfully, you can also include food delivery insurance as an expense too.
Submitting your HMRC tax return
At the end of each tax year, you must submit your tax return to HMRC. If you fail to do this on time, you will likely receive a penalty notice requiring you to pay a fine.
Paying any tax due
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