Uber & Taxi Driver Tax Return UK 2026: Mileage, Expenses and Refunds

If you drive for Uber, Bolt, Addison Lee, a local minicab firm, or your own black cab, HMRC treats you as self-employed. That means a Self Assessment tax return every year, even if driving is a side job on top of a regular wage. The good news most drivers miss: you are taxed on your profit, not your fares. Claim every cost the law allows and your tax bill can fall sharply, and many drivers who have never claimed properly are owed money back.

This guide explains exactly how driver tax works in 2026: when you need to register, the two ways to claim your vehicle costs, every expense you can put through, the deadlines that carry penalties, and how to stop overpaying.

Are Uber and Taxi Drivers Self-Employed?

For tax, yes. Whether you are on Uber, Bolt, a private hire app, a minicab circuit, or driving a hackney carriage, HMRC sees you as a self-employed sole trader running your own driving business. You are responsible for telling HMRC about your income and paying your own Income Tax and National Insurance. The platform does not deduct tax for you the way an employer does under PAYE.

This applies even if you only drive part time. A nurse, warehouse worker or office employee who picks up Uber shifts at the weekend is employed for the day job and self-employed for the driving, and the driving income has to go on a tax return.

Do You Need to File a Tax Return?

You must register with HMRC and file a Self Assessment return if your total self-employed income for the tax year is more than the £1,000 trading allowance. That £1,000 is measured on your takings before expenses, and it covers all your self-employed work added together, not each job separately.

If you earned more than £1,000 from driving, register as self-employed and file, even if it is a side hustle. If you are not sure how, see our guide on how to register for Self Assessment with HMRC.

The Biggest Decision: Mileage vs Actual Costs

Your car is your single largest expense, and there are two ways to claim it. You pick one method per vehicle and stick with it for the life of that vehicle, so it pays to choose well.

Method 1: Simplified mileage

You claim a flat rate per business mile that covers everything to do with running the car:

• 55p per mile for the first 10,000 business miles in the tax year (the rate rose from 45p to 55p from April 2026)
• 25p per mile for every business mile after that

This single figure covers fuel, insurance, servicing, MOT, repairs, road tax and depreciation. You cannot then claim those running costs separately on top. All you need is a mileage log. For most drivers doing high mileage in an ordinary car, this method is simple and generous.

Method 2: Actual costs

You add up every real running cost for the year (fuel, insurance, servicing, repairs, MOT, road tax, finance interest, depreciation through capital allowances) and claim the business-use proportion. If 90% of your mileage is for fares, you claim 90% of the costs. This takes more record keeping but can win for expensive vehicles, electric cars, or anyone with high real costs.

Expenses Every Driver Should Be Claiming

On top of your chosen vehicle method, these costs are allowable for the business proportion of their use:

• Platform fees and commission: the service fee or commission Uber, Bolt and other apps take from each fare is a business cost. It is money you never actually keep, so do not pay tax on it.
• Licensing: your private hire or hackney carriage driver licence, vehicle licence, and the local council application fees.
• Hire and reward insurance: the specialist taxi or private hire policy you are legally required to hold (claim in full under actual costs, or it is already covered inside the 55p mileage rate).
• Phone and data: the business-use proportion of the mobile and data plan you run the apps on.
• Vehicle cleaning: car washes and valeting to keep the cab presentable for passengers.
• Congestion Charge and ULEZ: charges incurred while working (not personal trips).
• Breakdown cover, dashcam, and in-car essentials such as phone mounts and chargers used for work.
• Accountancy fees: the cost of having your return prepared is itself deductible.

For a fuller list that applies to any self-employed person, see our complete guide to sole trader expenses.

What You Cannot Claim

A few things are not allowable, and claiming them creates HMRC risk:

• Parking and speeding fines, even when picked up while working.
• The personal-use share of your car, fuel and phone. Only the business proportion counts.
• Everyday clothing. Ordinary clothes are not deductible even if you only wear them to drive.
• The cost of buying the car outright is not a simple expense. It is handled through capital allowances or the mileage rate, never both.

A Worked Example

In this example the driver took £32,000 but is taxed on £13,350, because fares are not profit. The 25,000 business miles alone (10,000 at 55p plus 15,000 at 25p) produce £9,250 of deductions. A driver who never claimed mileage or fees would be taxed on far more and overpay by thousands. This is exactly where most drivers lose money.

Deadlines and Penalties

The tax year runs to 5 April. The key date is 31 January, when both your online tax return and the tax you owe for the previous year are due. Miss the filing deadline and HMRC charges an automatic £100 penalty straight away, even if you owe no tax, with further daily penalties and interest building after three months. Register early, because new drivers need to set up a Self Assessment record before they can file, and that can take a couple of weeks.

Records to Keep

Keep it simple but keep it consistent. You need a record of your fares (your Uber or Bolt statements do most of this), a mileage log of business miles, and receipts or statements for your costs. Hold onto everything for at least five years after the filing deadline. A driver with clean records pays less, because nothing allowable gets missed.

Frequently Asked Questions