Quick answer: UK delivery drivers can deduct mileage at 45p/mile (first 10,000 miles), phone and data costs, insulated bags, and hi-vis clothing from their taxable profit. A driver earning £25,000 with £6,000 in expenses pays tax on only £19,000 — saving approximately £1,200 in Income Tax and NI.
Allowable expenses
These expenses reduce your taxable profit — claim every one you are entitled to. Keep receipts and records for all business costs throughout the year.
| Expense | Notes |
|---|---|
| Mileage — car | 45p/mile first 10,000, then 25p/mile |
| Mileage — motorbike | 24p/mile |
| Mileage — bicycle | 20p/mile |
| Mobile phone | Business proportion only (e.g. 50%) |
| Thermal delivery bags | Full cost if used only for deliveries |
| Insulated boxes & equipment | Full cost if solely for business |
| Cycling gear & helmet | Full cost — necessary for safety |
| Hi-vis jacket & clothing | Protective/uniform clothing only |
| Business insurance | Public liability, goods in transit |
| Vehicle insurance | Business proportion if also for personal use |
| Parking fees | Business trips only — not fines |
| Congestion charge | Business trips only |
| Accountant fees | Full cost |
| Tax software | Full cost |
| Bank charges | Business account only |
| Vehicle servicing | Business proportion only if also private |
| Vehicle repairs | Business proportion only |
| PPE & cleaning supplies | Business use only |
| Data & broadband | Business proportion only |
| Platform fees | Any fees charged by the platform |
Important note
If you claim mileage allowance you cannot also separately claim fuel, insurance, vehicle tax, and servicing. Choose whichever method gives you the higher deduction. For most gig drivers, the mileage rate works out more favourable.
Estimates based on HMRC 2025/26 rates. General guidance only — not financial, tax, or legal advice.
Your actual liability may differ. Consult a qualified accountant for personalised advice. Verify rates at gov.uk.