Gig worker tax in the UK is more important than ever. With HMRC increasing compliance checks on gig economy workers and platform income data-sharing, getting your self-employed tax right isn’t optional—it’s essential.
Whether you drive for Uber, deliver for Deliveroo, or work across multiple platforms like Just Eat and Amazon Flex, many gig workers could be overpaying tax by £1,500-4,000 every year simply because they don’t claim the tax deductions they’re legally entitled to.
The problem? Many delivery drivers and ride-hailing workers don’t realise that business expenses like mileage, phone costs, and equipment can dramatically reduce their tax bill.
HMRC is now focusing on ensuring gig economy workers are correctly registered and filing accurate returns—making it even more crucial to understand your obligations and claim every allowable expense.
This quick and easy gig economy tax guide will help you discover:
- Tax deductions Uber drivers, Deliveroo riders, and delivery workers can claim
- understand self-employed tax obligations specific to gig work
- learn how to track expenses properly to maximize your refund
- avoid HMRC penalties by staying compliant
- calculate your actual tax bill with real examples
- and backdate claims for up to 4 tax years if you’ve missed previous deductions.
Potential savings: Gig workers who claim all their allowable expenses could save £1,500-4,000+ per year depending on their circumstances—money that stays in your pocket instead of going unnecessarily to HMRC.
Whether you’re a full-time Uber driver earning £35,000, a part-time Deliveroo cyclist making £12,000, or working across multiple gig platforms, this guide shows you what you can claim and how to do it correctly.
Understanding Gig Worker Tax Status in the UK
Potential savings: Gig workers who claim all their allowable expenses could save £1,500-4,000+ per year depending on their circumstances—money that stays in your pocket instead of going unnecessarily to HMRC.
Whether you’re a full-time Uber driver earning £35,000, a part-time Deliveroo cyclist making £12,000, or working across multiple gig platforms, this guide shows you exactly what you can claim and how to do it correctly.
Last updated: December 2025 with current HMRC rates and regulations
Are Gig Workers Self-Employed?
For gig economy tax purposes, most platform workers are classified as self-employed contractors. This affects your gig worker tax obligations significantly.
Platforms where workers pay self-employed tax:
- Ride-hailing: Uber, Bolt, Ola, Free Now
- Food delivery: Deliveroo, Just Eat, Uber Eats, Getir
- Parcel delivery: Amazon Flex, Evri (formerly Hermes), DPD
- Task platforms: TaskRabbit, Handy, Airtasker
- Freelance platforms: Upwork, Fiverr, PeoplePerHour
Gig Worker Tax Responsibilities
As a self-employed gig worker, you must:
- Register for Self Assessment with HMRC
- Complete annual tax returns (deadline: 31st January)
- Pay Income Tax on profits (income minus expenses)
- Pay Class 4 National Insurance (Class 2 is automatically treated as paid if profits over £6,845)
- Keep records for at least five years after the 31st January submission deadline of the relevant tax year
Failure to register for gig economy tax = £100+ penalties
Gig Worker Tax Deductions
Vehicle Expenses (Biggest Gig Worker Tax Deduction)
For Uber drivers, taxi drivers, and car delivery workers:
Option A: Simplified Mileage Allowance
The most popular gig worker tax deduction method using HMRC AMAP rates:
- 45p per mile (first 10,000 business miles)
- 25p per mile (after 10,000 miles)
- Covers: fuel, insurance, MOT, servicing, depreciation, repairs
Real example:
- Drive 12,000 business miles per year
- First 10,000 miles = £4,500
- Next 2,000 miles = £500
- Total gig worker tax deduction: £5,000
- Tax saved (basic rate): £1,000
Option B: Actual Vehicle Costs
Alternative gig economy tax deduction method:
- Fuel costs (business proportion)
- Servicing and MOT
- Insurance (business element)
- Tyres and repairs
- Road tax
- Vehicle depreciation
- Business parking
Which gig worker tax deduction method is better?
- High-mileage drivers → Usually mileage allowance
- Electric vehicle drivers → Often actual costs
- Expensive vehicle purchases → Calculate both methods and compare
Critical for gig worker tax: Keep a detailed mileage log using apps like:
- MileIQ
- Driversnote
- QuickBooks Self-Employed
- Everlance
Bicycle & E-Bike Tax Deductions (Delivery Riders)
Deliveroo tax expenses for cyclists:
- Bicycle/e-bike purchase (capital allowance)
- Repairs and maintenance
- Safety equipment (helmet, lights, hi-vis)
- Locks and security
- Cycle insurance
- Phone mount and accessories
Example Deliveroo tax deduction:
- E-bike purchase: £1,200
- Repairs/maintenance: £300/year
- Safety gear: £150
- Insurance: £100
- Total first-year deduction: £1,750
Motorbike & Scooter Tax Deductions
Gig worker tax relief for motorcycle couriers:
- Fuel (mileage allowance: 24p per mile)
- Servicing and repairs
- Insurance (business use)
- Protective clothing (helmets, gloves, boots, jackets)
- Breakdown cover
- Parking while working
All protective gear = allowable gig economy tax deductions
Uber Driver Tax Deductions (Specific)
Beyond vehicle costs, Uber driver tax relief includes:
Licensing & Compliance
- PCO/PHV license fees (£300 for 3 years = £100/year)
- Medical examination (£50-150)
- DBS check (£44.50)
- English language test (if required)
- Topographical knowledge tests
Vehicle Standards
- Dash cam (mandatory in most areas)
- Vehicle signage and branding
- Child seats (if offering family rides)
- Wheelchair accessibility modifications
- Emissions/ULEZ compliance testing
Hire-to-Rent Schemes
Using a rental car through Uber PCO hire schemes?
- 100% of rental fees = tax deductible
- Includes: insurance, maintenance, breakdown
- Huge gig worker tax deduction: £250-400/week = £13,000-20,000/year
Phone & Technology Tax Deductions
Essential for all gig economy tax claims:
- Mobile phone contract (business use %)
- Data/internet costs
- Chargers and cables
- Phone mounts
- Navigation app subscriptions (Waze Plus, etc.)
- Laptop/tablet for admin work
How to calculate phone gig worker tax deduction:
- If 80% of phone use is for gig work
- Monthly bill: £40
- Annual deduction: £40 × 12 × 80% = £384
Delivery Equipment & Supplies
Deliveroo tax and Just Eat tax deductions:
- Insulated delivery bags (required by platforms)
- Additional storage boxes
- Ice packs and cooling equipment
- Waterproof gloves
- Rain gear and hi-vis clothing
- Torches and lighting
- Hand sanitizer and cleaning supplies
Insurance Tax Deductions
Gig worker tax relief on business insurance:
- Hire & reward insurance (Uber/taxi drivers)
- Goods in transit cover (delivery drivers)
- Public liability insurance
- Income protection insurance (business-related)
Warning: Standard car insurance doesn’t cover gig work. You MUST have appropriate cover—and it’s tax deductible.
Parking & Road Charges (Business Use Only)
Allowable gig economy tax deductions:
- Airport parking (while waiting for fares)
- Congestion charge (business proportion)
- ULEZ/clean air zone charges (business %)
- Meter parking during work
NOT deductible:
- Home parking
- Personal shopping parking
- Parking fines/tickets
Professional Costs & Training
Gig worker tax deductions for professional development:
- Advanced driving courses
- Disability awareness training
- Accountancy fees
- Union membership (IWGB, GMB, etc.)
- Trade publications
Home Office Tax Deductions
If you do admin work at home (invoicing, planning, records):
Simplified method:
- £6 per week = £312/year deduction
- No receipts needed
- Best for most gig workers
Actual costs method:
- Calculate % of home used for business
- Claim portion of: rent, utilities, internet, council tax
- Requires detailed records
Bank & Payment Processing Fees
Gig economy tax deductions for financial costs:
- Business bank account fees
- Card processing charges
- Overdraft interest (business account)
- Currency conversion fees (if relevant)
Cleaning & Presentation
Uber driver tax and delivery driver expenses:
- Car valeting and cleaning products
- Air fresheners
- Tissues and hand sanitizer for customers
- Seat covers and floor mats
What You CANNOT Claim as Gig Worker Tax Deductions
Common mistakes that trigger HMRC investigations:
- Parking fines and speeding tickets – Penalties are never tax deductible
- Personal food and drink – Unless overnight business travel (rare for gig workers)
- Gym memberships – Even if you need fitness for cycling
- Standard clothing – Unless branded or protective gear
- Commuting – Home to your first job = personal travel (Between jobs = business travel)
- Private/personal portion of mixed expenses – Can only claim business use percentage
- Entertainment and socialising – Gig economy tax rules don’t allow this
Gig Worker Tax Return: Step-by-Step Guide
Step 1: Register for Self Assessment (If Not Already Done)
When to register for gig economy tax:
- By 5th October after your first tax year of gig work
- If you earned more than £1000 in a tax year
How to register:
- Visit: www.gov.uk/register-for-self-assessment
- You’ll need your National Insurance number
- Receive your UTR (Unique Taxpayer Reference) by post
Step 2: Track Your Gig Worker Income
Gather income statements from:
- Uber driver earnings statements
- Deliveroo weekly summaries
- Just Eat payment reports
- Any other platform reports
Add:
- Cash tips (must be declared)
- Bonuses and incentives
- Referral payments
Step 3: Calculate Your Gig Worker Tax Deductions
Track expenses using:
- Spreadsheet (simple but manual)
- QuickBooks Self-Employed
- FreeAgent
- Coconut
- Crunch
Record for each expense:
- Date
- Description
- Amount
- Category
- Receipt/proof
Important: Keep all records for at least five years after the 31st January submission deadline of the relevant tax year.
Example: For the 2024/25 tax year (ending 5 April 2025), you submit your return by 31 January 2026. You must keep records until at least 31 January 2031.
Step 4: Complete Your Self Assessment Tax Return
Gig economy tax return deadline:
- Paper: 31st October
- Online: 31st January
Where to enter gig worker expenses:
- Use form SA103 (self-employment pages)
- Section 3: Business expenses
- Enter total for each category
Options for filing:
- DIY: HMRC online service (free)
- Software: QuickBooks, TaxCalc, etc. (about£10-20/month)
- Accountant: Professional help (around £150-400/year, tax deductible)
Step 5: Pay Your Gig Worker Tax Bill
Payment deadline: 31st January
What you’ll pay:
- Income Tax (20% basic rate, 40% higher rate)
- Class 2 NI – automatically treated as paid if profits over £6,845 (protects your NI record)
- Class 4 NI – 6% on profits £12,570-£50,270, then 2% over £50,270
Plus: Payment on account for next year (if tax bill over £1,000)
Gig Worker Tax Calculator: Real Examples
Example 1: Uber Driver (Full-Time)
Income: £35,000
Expenses:
- Mileage (15,000 miles @ 45p): £6,750
- PCO license: £100
- Insurance: £2,000
- Phone (80%): £384
- Dash cam: £150
- Cleaning: £300
- Accountant: £200
Total gig worker tax deductions: £9,884
Tax calculation:
- Profit: £35,000 – £9,884 = £25,116
- Less personal allowance: £25,116 – £12,570 = £12,546
- Income tax (20%): £2,509
- Class 4 NI (6%): £753
- Class 2 NI: Automatically treated as paid
Total tax: £3,262
Without claiming expenses:
- Tax bill would be: £5,795
- Saving: £2,533
Example 2: Deliveroo Cyclist (Part-Time)
Income: £12,000
Expenses:
- Bike maintenance: £400
- Equipment (bags, clothing): £350
- Phone (70%): £252
- Insurance: £120
- Home office: £312
Total gig economy tax deductions: £1,434
Tax calculation:
- Profit: £12,000 – £1,434 = £10,566
- Under personal allowance = No tax to pay
- Class 2 NI: Automatically treated as paid (profits over £6,845)
Example 3: Multi-App Delivery Driver
Platforms: Uber Eats + Deliveroo + Just Eat
Income: £28,000
Expenses:
- Mileage (11,000 miles): £4,950
- Car insurance: £1,800
- Phone: £400
- Delivery bags: £200
- MOT/servicing: £450
- Home office: £312
- Accountant: £250
Total deductions: £8,362
Tax calculation:
- Profit: £28,000 – £8,362 = £19,638
- Taxable profit: £19,638 – £12,570 = £7,068
- Income tax (20%): £1,414
- Class 4 NI (6%): £424
- Class 2 NI: Automatically treated as paid
- Total tax: £1,838
Without claiming expenses:
- Tax bill would be: £3,515
- Saving: £1,677
Backdating Gig Worker Tax Claims
Can I Claim Back Previous Years?
Yes! You can backdate gig worker tax deductions for up to 4 tax years.
In 2025/26, you can amend:
- 2024/25 tax year
- 2023/24 tax year
- 2022/23 tax year
- 2021/22 tax year
Potential backdated claim:
- 4 years × £2,000 average saving = £8,000 refund
How to backdate:
- Gather old records (bank statements, platform reports)
- Estimate expenses reasonably (if no receipts for some items)
- Amend past tax returns via HMRC online or through an accountant
Common Gig Worker Tax Mistakes (And How to Avoid Them)
Mistake 1: Not Registering for Self Assessment
The problem: Many new gig workers don’t realize they need to register The fix: Register by 5th October after starting gig work Penalty: £100+ for late registration
Mistake 2: Claiming Personal Expenses
The problem: Claiming non-business costs (commuting, personal fuel) The fix: Only claim genuine business expenses with proof Risk: HMRC investigation + penalties + interest
Mistake 3: No Mileage Log
The problem: Trying to estimate mileage without records The fix: Use automatic tracking apps from day one Impact: Could lose £1,000s in unclaimed gig worker tax deductions
Mistake 4: Not Setting Money Aside
The problem: Spending all income, then shocked by January tax bill The fix: Save 25-30% of income in separate account Impact: Debt, payment plans, stress
Mistake 5: Missing the Deadline
The problem: Late filing on 31st January
Penalty timeline:
- 1 day late: £100 fine
- 3 months late: £10 per day (up to £900)
- 6 months late: £300 or 5% of tax due
- 12 months late: Another £300 or 5%
The fix: File in December, don’t wait until January
Mistake 6: Not Keeping Receipts
The problem: No proof of expenses = HMRC can disallow them
The fix:
- Take photos immediately
- Use cloud storage (Google Drive, Dropbox)
- Accounting apps capture receipts automatically
- Keep all records for at least five years after the 31st January submission deadline
Example timeline:
- 2024/25 tax year → Submit by 31 Jan 2026 → Keep records until 31 Jan 2031
Mistake 7: Wrong Tax Status
The problem: Some gig workers should be employed (rare) The fix: Check your contract status Tool: HMRC Employment Status Checker (www.gov.uk/guidance/check-employment-status-for-tax)
Gig Economy Tax Planning Strategies
- Set Up Automated Tax Savings
Best practice for gig worker tax:
- Open separate savings account
- Set up standing order after each pay period
- Transfer 30% of income automatically
- Don’t touch until January 31st
Apps that help:
- Coconut (automatic tax estimation)
- QuickBooks (tax calculation)
- Crunch (tax reserves)
- Make Payments on Account Work for You
What are payments on account?
- If your tax bill exceeds £1,000, HMRC makes you pay twice yearly
- January 31st: Pay this year’s tax + 50% advance for next year
- July 31st: Pay remaining 50% advance
Strategy:
- Claim all expenses to reduce profit
- Lower profit = lower payments on account
- More cash flow through the year
- Pension Contributions for Gig Workers
Gig worker tax benefit:
- Personal pension contributions get 20% tax relief automatically
- Higher-rate taxpayers claim extra 20% on tax return
- Reduces your taxable profit
Example:
- Pay £800 into pension
- Government adds £200 = £1,000 total
- Claim £200 more if higher-rate taxpayer
- Effective cost: £600 for £1,000 saved
- Timing Large Purchases
Gig economy tax planning:
- Tax year runs 6th April to 5th April
- Buy equipment before 5th April = claim in current year
- Buy after 6th April = claim in next year
Strategy: If expecting higher income next year, delay purchases
- Keep on Top of Quarterly Reviews
Best practice:
- Review finances every 3 months
- Check if you’re saving enough for tax
- Identify missing receipts
- Update accounting software
Gig Worker Tax Software & Tools
Some of the best Accounting Apps for Gig Workers
- QuickBooks Self-Employed (£6/month)
- Automatic expense categorization
- Mileage tracking via GPS
- Connects to bank accounts
- Self Assessment tax estimation
- Best for Uber drivers
- Coconut (Free basic / £9/month premium)
- Designed for UK gig workers
- Tax estimation and saving pots
- Receipt scanning
- Best for delivery riders
- FreeAgent (£14/month)
- Comprehensive features
- Excellent reporting
- Client invoicing (if needed)
- Best for multi-platform workers
- Crunch (£21.50/month with accountant support)
- Software + human accountant
- Self Assessment filing included
- Best for those wanting guidance
Some of the best Mileage Tracking Apps
- MileIQ (£5.99/month)
- Auto-detects drives
- Swipe to classify business/personal
- HMRC-compliant reports
- Driversnote (Free / £4.99/month)
- 30 free logs/month on free plan
- GPS tracking
- Integrates with accounting software
- QuickBooks Mileage
- Included with QuickBooks Self-Employed
- Automatic tracking
- One-app solution
Gig Worker Tax FAQs
How much tax do gig workers pay in the UK?
Gig worker tax depends on your profit (income minus expenses):
- £0-£12,570: No income tax (personal allowance)
- £12,571-£50,270: 20% income tax + 6% Class 4 NI
- £50,271+: 40% income tax + 2% Class 4 NI
Plus: Class 2 NI is automatically treated as paid if your profits are £6,845 or more (no payment needed, but protects your NI record)
Do I need to pay gig worker tax if I earn under £1,000?
Trading allowance: If gig income under £1,000/year, you don’t need to:
- Register for Self Assessment
- Pay tax on this income
Over £1,000: You must register and file a return
Can I claim gig worker tax deductions without receipts?
Simplified expenses: Some expenses don’t need receipts:
- Mileage allowance (but need mileage log)
- Home office simplified rate
Everything else: You need proof (receipts, bank statements, invoices)
What records do gig workers need to keep?
HMRC requires you to keep records for at least five years after the 31st January submission deadline of the relevant tax year:
- Income statements from platforms
- Bank statements
- Receipts for expenses
- Mileage logs
- Invoices (if you invoice clients)
When is the gig worker tax deadline?
Example: For the 2024/25 tax year (ending 5 April 2025), you submit your return by 31 January 2026. You must keep records until at least 31 January 2031.
Key dates:
- 5th October: Register for Self Assessment (first year)
- 31st October: Paper tax return deadline
- 31st January: Online return + payment deadline
- 31st July: Payment on account (2nd payment)
Can Uber drivers claim mileage?
Yes! Uber driver tax deductions include:
- 45p per mile (first 10,000 business miles)
- 25p per mile (after 10,000)
- This is usually the biggest Uber driver tax relief
Is Deliveroo tax deductible for cyclists?
Yes! Deliveroo tax claims for cyclists include:
- Bike purchase and repairs
- Safety equipment
- Insulated bags
- Phone costs
- Insurance
Do gig workers pay National Insurance?
Yes. Self-employed gig workers pay:
- Class 2 NI: Automatically treated as paid if profits over £6,845 (protects your NI record). If profits are under £6,845, you can voluntarily pay £3.50/week
- Class 4 NI: 6% on profits £12,570-£50,270, then 2% over £50,270
Different from employed NI: No employer contribution
Can I do gig work and have a full-time job?
Yes! Your tax situation:
- Main job = PAYE (tax deducted automatically)
- Gig work = Self Assessment
- File tax return combining both incomes
- May push you into higher tax bracket
How do I calculate my gig worker tax bill?
Manual calculation:
- Total platform income
- Minus allowable expenses
- = Profit
- Minus personal allowance (£12,570)
- = Taxable income
- Calculate tax + NI
Or use online calculators or accounting software for automatic calculation
Additional Resources
Government Resources:
- Register for Self Assessment: www.gov.uk/register-for-self-assessment
- File your tax return: www.gov.uk/log-in-file-self-assessment-tax-return
- Employment status checker: www.gov.uk/guidance/check-employment-status-for-tax
- Allowable expenses guide: www.gov.uk/expenses-if-youre-self-employed
- Self-employed National Insurance rates: www.gov.uk/self-employed-national-insurance-rates
Free Tax Advice (Low Income):
If your income is low and you need help:
- TaxAid: Free tax advice charity
- Tax Help for Older People: For those 60+
- LITRG (Low Incomes Tax Reform Group): Free guidance
Union Support
Gig worker unions offering tax support:
- IWGB (Independent Workers Union): Couriers & drivers
- GMB: Uber & Deliveroo sections
- App Drivers & Couriers Union (ADCU)
Key Takeaways: Gig Worker Tax Checklist
- Register for Self Assessment if you haven’t already (deadline: 5th October)
- Track ALL business expenses from day one—use apps like QuickBooks or Coconut
- Log your mileage automatically—biggest gig worker tax deduction for drivers
- Keep receipts for at least five years after the 31st January submission deadline—digital photos are fine
- Set aside 25-30% of income for tax—use separate savings account
- Claim vehicle expenses—mileage allowance usually best (45p/mile)
- Don’t miss platform-specific deductions—PCO license (Uber), delivery bags (Deliveroo)
- File by 31st January—avoid £100+ penalties
- Backdate claims if you’ve missed previous years—could be worth £1,000s
- Consider an accountant if confused—fees are tax deductible anyway
- Understand National Insurance—Class 2 is automatically treated as paid if profits over £6,845
Final Thoughts on Gig Economy Tax
Understanding gig worker tax doesn’t have to be overwhelming. The UK tax system allows legitimate business expenses to be deducted—but only if you claim them.
Many gig workers in the UK could be leaving £1,500-4,000+ unclaimed each year. Don’t be one of them.
Whether you’re a full-time Uber driver, part-time Deliveroo cyclist, or multi-app delivery driver, taking control of your gig economy tax situation can:
- Save you hundreds sometimes thousands of pounds annually
- Keep you compliant with HMRC
- Reduce stress and financial worry
- Help you plan for the future
Start today:
- Download a mileage tracking app
- Set up a tax savings account
- Start keeping every receipt
- Consider using accounting software or hiring an accountant
Remember: Every legitimate expense you don’t claim is money left on the table. Don’t overpay gig worker tax—claim what’s rightfully yours.
