5 Top Tax Deductions for Delivery Drivers in the UK

Managing your taxes as a delivery driver or self-employed professional can feel overwhelming at times. But here's a simple way to ease the burden—knowing what expenses you can claim to reduce your income tax and National Insurance. As a delivery driver, whether you work as a freelancer, side hustler, or through platforms like Uber Eats, Deliveroo, or Amazon Flex, you likely incur numerous costs to keep your operation running. The good news? Many of these costs can qualify as allowable expenses under HMRC regulations, meaning you can save money during tax season. This comprehensive guide will walk you through five essential tax deductions tailored for delivery drivers in the UK. With the right knowledge and organisation, you'll maximise your financial efficiency while staying fully compliant with HMRC. 1. Vehicle Expenses – Fuel, Maintenance, and Depreciation Your vehicle is at the heart of your job as a delivery driver, so it’s no surprise that many vehicle-related costs are considered allowable expenses. What can you claim? Delivery drivers can claim expenses such as:Fuel Costs: Track petrol or diesel used solely for business purposes.Maintenance and Repairs: Repairs, services, and even MOT checks are deductible.Depreciation: The cost of the vehicle itself can be spread over several years as a business expense using capital allowances. To keep things simple, HMRC also allows you to use their simplified mileage rate, which is currently 45p per mile for the first 10,000 miles and 25p thereafter. This rate covers the cost of fuel, repairs, insurance, and more. Example An Amazon Flex driver can keep a log of business miles driven and claim this flat rate instead of calculating each individual expense. This method is especially helpful for part-time drivers or side hustlers. Check out the latest HMRC mileage rates here. 2. Insurance Costs – Protecting Your Work Vehicle Driving for work requires specific types of insurance, and those costs can add up. Luckily, as long as you have appropriate vehicle insurance for business use, those premiums typically qualify as an allowable expense. What can you claim? Hire & Reward Insurance: Required for delivery drivers transporting goods. Public Liability Insurance: For those driving as part of specific contracts or self-employed businesses. However, personal vehicle insurance without a business element does not qualify as an allowable expense. Example An Uber Eats rider can deduct the cost of their business-required delivery insurance but not their personal car insurance unless it includes business cover. 3. Equipment and Tools – Phones, Satnavs, and Delivery Gear The tools of your trade are just as important as your vehicle. Whether you're navigating routes or safely delivering food on time, essential equipment is another category of deductible expense. What can you claim? Phones and Satnavs: Costs of mobile phone bills and navigation tools are deductible if used for business communication or routing. Delivery Gear: Items such as thermal delivery bags, helmets, and other safety equipment. Example A Deliveroo rider who buys a high-quality thermal bag to ensure food stays fresh during delivery can claim the cost of that bag in their tax return. For more on what qualifies as business equipment, check out HMRC’s guidelines here. 4. Office and Administrative Costs – Managing Your Side Gig Efficiently Delivery driving often comes with administrative work, even if you’re self-employed. Costs associated with managing this back-end work are often overlooked as deductible expenses. What can you claim? Phone and Internet Costs: A percentage of your monthly bills if used for work-related activities, such as booking shifts or managing customer communications. Home Office Supplies: Stationery, printer ink, or even a percentage of your rent/utilities if you use part of your home for work administration. Example A part-time courier who uses a corner of their home for completing paperwork can calculate and apportion costs related to that space. Make sure to follow HMRC’s rules on apportioning costs correctly for your work use. Learn more about claiming home office expenses here. 5. Professional Services – Accounting and Tax Advice Navigating HMRC rules and allowable expenses can sometimes feel like a maze. Hiring professional services—like accountants or tax advisors—not only takes the pressure off but is also a deductible expense. What can you claim? Accountancy Fees: Whether you use online accountants or virtual tax advisors. Tax Filing Assistance: Any services specifically associated with ensuring compliance, filing taxes, or financial planning. Example A freelancer who uses services like Virtue Accountants to file an accurate, HMRC-compliant tax return can deduct the associated fees from their income. Get Tax-Savvy and Save Big Claiming these tax deductions as a delivery driver in the UK isn’t just a good financial move—it’s an essential one. By thoroughly understanding HMRC’s allowable expenses guidelines, you can significantly reduce your income tax and National Insurance obligations while keeping your side gig or small business profitable. Want to simplify your tax process even further? Virtue Accountants offers expert help tailored to self-employed professionals and delivery drivers. Book a consultation today and start saving on your taxes with confidence.