Taxi and private hire drivers run more than just a vehicle. Like any other self-employed worker, they must manage income, costs, licences, bookings, vehicle repairs, and more. It may seem dull, but good record-keeping is an incredibly important part of the job.
How good record-keeping helps you
With lots to manage as a busy taxi driver, record-keeping helps you stay organised, and it can avoid headaches if you need to check something further down the line. Relying on your memory alone can be challenging when you need to handle lots of different documents.
Accurate documentation is especially helpful for tax purposes – if you are unable to show HMRC the records you used to complete your tax return when asked, you may have to pay them a fine.
Important records taxi drivers should keep
1. Income records
Taxi and private hire drivers receive payment in several ways, including cash, card, and via ride-hailing apps.
Recording income accurately will help you keep track of your true earnings, and it will also make things easier for you (or your accountant) when it’s time to fill out your tax return.
2. Expenses
Expenses such as fuel, tyres, servicing, licence fees, taxi insurance, parking, and vehicle finance can all impact your profit margins.
Accurately recording your expenses will help you track running costs and identify rising costs before they become a larger problem.
3. Vehicle records
Having an accurate record of service history, MOT documents, tyre changes, repairs, and inspection notes will give you peace of mind and make it easier to check that your vehicle maintenance is up to date.
4. Renewal dates
Licences, MOTs, vehicle checks, and taxi insurance can all renew at different times. Missing one date can disrupt your work and, therefore, your income.
Something as simple as a calendar reminder can help avoid any missed deadlines. This is especially useful for your taxi insurance renewal, where you may choose to review your coverage needs.
Bottom line
Record keeping doesn’t need to be complicated. Having an accurate record of everything will help you stay organised and feel more in control of your business.
Making Tax Digital
HMRC is changing the way self-employed people report their earnings through the Making Tax Digital initiative, which could affect many taxi and private hire drivers earning over a certain threshold.
When you need to start using Making Tax Digital depends on your qualifying income within a tax year. If your qualifying income is over:
- £30,000 for the 2025 to 2026 tax year, you will need to use it from 6 April 2027.
- £20,000 for the 2026 to 2027 tax year, you will need to use it from 6 April 2028.
Taxi insurance renewal coming up?
If you’re looking to find a better deal at your renewal, let us help. At Patons Insurance, we take the hassle out of finding cover by comparing quotes from our panel of insurers, helping you secure suitable protection at a great price. That means less time spent shopping around so you can focus on what matters.
Start your fast, free, and competitive quote today through our website or call us on 0333 015 6886.
