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Uber Tax Guide

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Everything you need to know to about tax when you work as a driver at Uber in the UK.

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Uber is a platform that connects drivers with people needing a lift or people ordering food. Uber drivers can pick you up and take you to a location or deliver food from a restaurant to your house.

For many, driving for Uber is the perfect side hustle around studies, projects, or other jobs, as you pick your hours and earn as much as you work.

Since its launch in the UK  in 2012, there are now around 70,000 drivers transporting people and food around urban areas. The hail-a-ride app is so popular that Uber celebrated the one billionth trip being taken in the UK at the end of last year (the lucky passenger won a decade’s worth of free rides which isn’t bad).

With a landmark case in early 2021, the relationship between drivers and Uber and things like how much they can earn changed, as the Supreme Court ruled that Uber drivers were not independent contractors, but workers with statutory holidays, pensions, and minimum wage.

We’ve put together this guide to explain everything you need to know when becoming an Uber driver.

How to become an Uber driver

‍Becoming a driver for Uber isn’t too complex, but you need to meet all the minimum requirements demanded by the company, and upload every information into the Uber portal. Specifically:

  • A valid UK driver’s licence. Note that if you have an EU licence, it need to be converted to a UK one.
  • A private hire licence from your local council
  • Proof of UK residency
  • Proof of insurance on your car and private hire insurance
  • A bank statement with your name and bank details for payment, or a business which you’re an owner of

Uber requires also that vehicles meet their minimum standards, which are:

  • 4 doors
  • it can hold a minimum of four passengers (so needs to be a 5-seater or above)
  • it needs to be in good condition

Once you’ve uploaded everything, you’ll need to follow the online Edume course to familiarise yourself with the Uber app, and then visit one of their Greenlight hubs to get your profile picture taken and activate your account.

How much can I make as an Uber driver?

After the Supreme Court ruling in 2021, as an Uber driver, you’ll earn at least the national living wage, which is £9.50 per hour for the over 23s. Moreover, you’ll receive 12.5% of your earnings every 2 weeks as a holiday payment.

However, it’s important for you to know that Uber take 25% of each one of your journey, meaning that you’ll receive 75% of what you see.


Generally, according to car leasing company Splend, Uber drivers make on average between £250 and £800 per week, pre vehicle costs and tax. With many drivers using rent-to-buy schemes or paying off the vehicle cost in instalments, you may also need to factor this in:

https://assets-global.website-files.com/6187dc9778a578119292ebca/62b4c8932babd92d5f494d15_Uber Earnings Table.png

Taken from Splend’s data after talking to 100 Uber drivers

You also need to consider some costs, when deciding to become an Uber driver. Such as:

  • Fuel: according to Energy Saving Trust UK is about £2-£10 per 100 miles for hybrids, depending on where you charge and what car you have. And for the average single combustion engine car, it’s about £13-£16 per 100 miles.
  • London’s ultra-low emission zone (ULEZ) and congestion charge zone: if you’re part of the 64% of Uber drivers in London, you need to be aware of these charges. Whereas for cars with petrol engines, it’s £12.50 per day for the ULEZ and £15 per day for the congestion, plug-in hybrid and electric cars aren’t charged.
  • Private hire insurance: this costs on average £3000 per year (£60 per week).

To sum it up in a nutshell,  if you drive a petrol car, your average take-home each month after these costs would be about £1,863. On the other hand, if your car is either a hybrid plug-in or a full electric, your average take-home is £1,960.

Do I need to pay tax? And how do I pay tax?

As you’re classified as a worker, you would expect to sort out your tax with PAYE. However, given that Uber doesn’t pay you a monthly salary with PAYE, you’ll need to complete a self-assessment tax return.

As with any other occupation, you’ll be taxed based on your annual earnings. Therefore, the tax bands for Uber drivers are the following:

  • Tax allowance: 0% of earnings (You earned between £0 - £12,570)
  • Basic rate: 20% of earnings (You earned between £12,571- £50,270)
  • Higher rate: 40% of earnings (You earned between £50,271 - £150,000)
  • Additional rate: 45% of earnings over £150,000

Don't forget that you'll also need to pay National Insurance on your income if you earn over £11,908 in a year.

You need to fill out a self-assessment tax return each year. What you pay is your freelance tax bill minus the expenses of running your business. You can read more on how to complete your self-assessment tax return in this Earnr article.

The usual cut-off date to complete your self-assessment is the 31st of January if you’re doing it online, and the 31st of October if you’re completing the form by post.

What can I expense as an Uber Driver?

There’s quite a lot you can claim in expenses as an Uber driver. This is due to the many costs of running your car, from petrol to congestion charges. You can deduct these costs from your taxable profit as long as they’re eligible.

So if you earn £36,000 and you claim £9,000 in expenses, you’d only be taxed on £27,000 for the year which reduces the burden of tax on your income.

You can read more on what the Government considers expenses here.

As an Uber driver you might expense things like:

  • Car maintenance costs
  • Charges on high congestion areas or motorways
  • Private hire insurance
  • Fuel
  • Phone bill for using the Uber app and data

Be aware that if you use the same vehicle for work and for your own personal use then you’ll need to factor this in when any expenses are claimed. If you work out that you use your vehicle 40% of the time for personal use, then you would need to reduce any relevant vehicle running expenses by 40%. The same happens for your phone bill if you use your personal phone, you should calculate which portion of your phone usage can be counted as running expenses.

How can Earnr help?

Earnr allows you to track your ingoings and outgoings over the course of the year, and automate your tax return. You can separate your business transactions from your personal ones, track your expenses and get a real-time tax estimate so you know whether or not you need to submit a tax return.

Check it out here.

Other articles

Looking for more? Why not check out some of the other articles we've written to help you with your Uber business.

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