If you are a self employed taxi driver or own a private hire company you may need to do a tax return so that you can declare your earnings to the Inland Revenue and pay any appropriate tax. This article will help to highlight some key things to remember for your tax return.
Hopefully, before you start tax return you will have kept your records in good working order. You should keep a record of all your income and expenses.
Some examples of expenses that taxi drivers you can claim against any profit include:
- Interest for loans used to purchase a cab or other vehicle.
- Motoring expenditure
- Washing your vehicle
- License and other registration fees
- Office Costs (if you have one)
- Laundry for Uniform (if you wear a specific uniform)
If you use your cab for your own personal use then you need to factor this in when any expenses are claimed. For example if you calculate that you use your cab for 20% of the time for personal or family use, then you would need to reduce any relevant expenses, such as cleaning by 20%.
Often people ask if Taxi drivers can claim a mileage allowance, similar to when you use your car for business use. Unfortunately this is not possible because you will be factoring costs like petrol and repairs of the vehicle into your expenses already. You can however claim capital allowances on the cost of capital each year.
If you are a taxi driver and have any other questions about doing a tax return, you can ask in the comments below.