Smiling woman on a train wearing a navy coat and earphones, using a tablet by the window.

If you are self-employed, it is important to understand which car and travel costs are allowable for tax purposes.

You may claim allowable business expenses for car, van, and travel costs, which will reduce your taxable profits. Typical allowable costs include:

You cannot claim for:

For vehicle costs, you can choose between claiming actual running costs or using HMRC’s simplified expenses, which applies a flat-rate mileage allowance.

If you purchase a vehicle for use in your business, the method of relief will depend on your accounting basis. Under traditional accounting, capital allowances may be claimed on the cost of the vehicle. If you use the cash basis, capital allowances are also available, provided simplified expenses are not being used for that vehicle. Other vehicle-related and travel costs can be claimed as allowable business expenses in the usual way.

Source:HM Revenue & Customs | 13-04-2026
author avatar
Aitch
I'm Aitch, the Founder and CEO of CIGMA Accounting Ltd. As a Chartered Management Accountant and as a CIMA member, I've spent more than 16 years helping businesses, entrepreneurs, landlords, and individuals with tax planning, accounting, and HMRC compliance. As a chartered accountant in London, I'm passionate about making complex tax matters easier to understand and helping clients make confident financial decisions. Over the years, I've advised start-ups, SMEs, established companies, and high-net-worth individuals across a wide range of tax and accounting matters. My expertise includes Corporation Tax, Self-Assessment, Capital Gains Tax, Inheritance Tax planning, R&D tax relief, capital allowances, international tax, and resolving complex HMRC compliance issues. Whether clients need a business accountant, tax accountant, or strategic tax advisor, my focus is always on delivering practical advice that creates long-term value. One of my specialist areas is Making Tax Digital (MTD). I've worked extensively with businesses preparing HMRC's digital reporting requirements, helping them move to cloud accounting, improve financial processes, and adopt technology that makes compliance more efficient. I regularly speak at Making Tax Digital roadshows, industry events, and educational sessions in collaboration with Zoho Books, sharing practical insights into digital accounting, tax legislation, and the future of the profession. Many business owners looking for the best accounting firm in London are not simply searching for an accountant they're looking for trusted advice, responsive support, and long-term value. That's the approach I've taken in building CIGMA Accounting. My team and I work closely with businesses across London and the UK, providing accounting services, tax advisory, bookkeeping, payroll, VAT, company accounts, and strategic tax planning tailored to each client's goals. Through this website, I share practical guidance on UK taxation, Making Tax Digital, HMRC updates, Corporation Tax, Self-Assessment, and business finance. My aim is to provide reliable, straightforward information that helps business owners understand changing regulations, reduce compliance risks, and make informed financial decisions with confidence.

Our offices

CIGMA Accounting

CIGMA Accounting offices are at three places across London — Wimbledon, Farringdon, and Fulham.

Office 01
Wimbledon
165–167 Highland House
Wimbledon, London
SW19 1NE
Get directions
Office 02
Farringdon
127 Farringdon Road
London
EC1R 3DA
Get directions
Office 03
Fulham
20 Fulham Broadway
The Fulham Centre
London SW6 1AH
Get directions