Free tool · for drivers
Taxi driver expenses and mileage calculator
Enter your business miles and your car's yearly costs, and the calculator compares HMRC's flat mileage rate (55p a mile for the first 10,000 miles from 6 April 2026, then 25p) with your actual costs, or applies the IRS 2026 standard mileage rate. GOV.UK does not allow the flat rate for black cabs or hackney carriages.
Your year
Flat mileage rate or actual costs?
Cost figures are examples. Use the totals from your records.
Where you pay tax
£8,000
vehicle expenses for the year
GOV.UK says the flat rate cannot be used for cars designed for commercial use, such as black cabs and hackney carriages, or for a vehicle you have already claimed capital allowances for; once you use it for a vehicle you must keep using it. Under actual costs you may also claim capital allowances on the car, which this does not include. A guide, not tax advice.
How it works
Flat rate or actual costs: how the comparison works
In the UK a self-employed driver can work out vehicle expenses in one of two ways. Simplified expenses use a flat rate per business mile, which covers buying and running the car: insurance, repairs, servicing and fuel. For the 2026-27 tax year GOV.UK sets 55p a mile for the first 10,000 business miles and 25p after that; before 6 April 2026 the first rate was 45p. Actual costs add up what the car cost you and keep the business share, and can be combined with capital allowances on the car.
The flat rate is not open to every taxi. GOV.UK excludes cars designed for commercial use, giving black cabs and hackney carriages as examples, and any vehicle you have already claimed capital allowances for; once you use the flat rate for a vehicle, you keep using it for that vehicle. Private hire drivers in ordinary cars can usually choose either method, which is why the comparison is worth doing before the first year’s return.
In the US the IRS standard mileage rate does the same job. For 2026 it is 72.5 cents a mile from 1 January to 30 June and 76 cents from 1 July to 31 December, so the calculator asks for miles in each half. For the income side of the year, use the taxi driver earnings calculator; to keep the records, see the taxi bookkeeping template.
Sources
Where the figures come from
- GOV.UK: Simplified expenses if you're self-employed, Vehicles (read 2026-11-03)
- IRS: Standard mileage rates (read 2026-11-03)
FAQ
Mileage and expenses questions
What is the HMRC mileage rate for 2026?
For the 2026-27 tax year GOV.UK's simplified expenses flat rate for cars and goods vehicles is 55p a mile for the first 10,000 business miles and 25p a mile after that. Before 6 April 2026 the first rate was 45p.
Can taxi drivers use the HMRC flat mileage rate?
Private hire drivers in ordinary cars can usually choose it. GOV.UK says it cannot be used for cars designed for commercial use, such as black cabs and hackney carriages, or for a vehicle you have already claimed capital allowances for; those drivers work out actual costs instead.
What is the IRS mileage rate for 2026?
For business use the IRS standard mileage rate is 72.5 cents a mile from 1 January to 30 June 2026 and 76 cents a mile from 1 July to 31 December 2026.
Which is better, the flat rate or actual costs?
It depends on your miles and your car. High mileage in an economical car often favours the flat rate; an expensive car to insure and repair, or one you can claim capital allowances on, can favour actual costs. Enter both sides above to compare them for your year.
What other expenses can taxi drivers claim?
Business costs outside the car, such as licence fees, the rent or commission you pay the operator, a work phone and accountancy, are usually allowable on top under either method. Keep receipts and a mileage log; check the detail with an accountant or GOV.UK.
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