Van Expenses for Self-Employed Tradespeople: What You Can Claim Through Your Business

Van costs you can claim as a business expense

Fuel

Fuel for business journeys is fully claimable. If you also drive the van privately, keep a mileage log and claim only the business proportion. The simplest approach is to claim the actual business fuel cost from receipts; alternatively, use the HMRC flat rate (45p per mile for the first 10,000 business miles, 25p after). You can't use both methods for the same vehicle in the same year.

Insurance

Traders' van insurance, tools-in-transit cover and public liability insurance premiums are all claimable. If you pay annually, claim the full premium in the year you pay it (cash accounting) or spread it across the period it covers (accruals basis).

Road tax (Vehicle Excise Duty)

VED is a claimable expense. Keep the renewal receipt or bank statement as evidence.

Servicing, repairs and MOT

All routine maintenance — oil changes, tyres, brake pads, MOT fees — is fully deductible. Major repairs that restore the van to its original condition are also claimable as revenue expenses. Improvements that add value or extend the van's useful life may need to be capitalised instead — in practice this rarely applies to standard trade vans.

Finance interest

If you bought the van on hire purchase or a business loan, the interest element is deductible. The capital repayment is not an expense — the van itself is handled through capital allowances (see below).

Leasing or contract hire payments

If you lease the van rather than own it, the full lease payments are claimable as a business expense (provided the van is used for business). There's no capital allowance calculation because you don't own the asset.

Racking, shelving and signwriting

Permanent fixtures fitted to the van — racking, shelving, drawers, roof bars — are treated as part of the van for capital allowances purposes. Van signwriting is claimable as an advertising expense in the year you pay for it.

Tolls, parking and congestion charges

Legitimate business tolls and parking are claimable. Parking fines are not — HMRC views fines as a penalty for breaking the law, not a cost of running the business.

Claiming the van purchase: capital allowances

The cost of buying a van is not an expense you deduct in one go through your profit and loss. Instead, you claim capital allowances, which lets you deduct the cost against your taxable profits — usually in full in the year you buy it, using the Annual Investment Allowance (AIA).

If you buy a second-hand van, the same rules apply — the AIA covers new and used vehicles. The cost is the price you actually paid, not the original list price.

Electric vans bought new also qualify for 100% First Year Allowance (FYA), which achieves the same result as AIA. Leased electric vans get the same running cost deduction as diesel vans.

Handling private use of the van

If you drive the van for any private journeys — commuting to a fixed office, the school run, shopping — HMRC classes this as mixed use. You must either:

1. Keep a mileage log and apportion all running costs between business and private use, claiming only the business proportion; or
2. Use HMRC's simplified mileage rate (45p/25p per mile) instead of claiming actual costs — in which case you can't separately claim fuel, insurance or any other running costs.

If the van never goes home — it stays at a yard, depot or customer site — and no private journeys are made, HMRC generally accepts there is no private use and you can claim 100% of running costs without a mileage log. You will, however, need to be able to demonstrate this if challenged.

Simplified mileage or actual costs — which is better?

For tradespeople with a relatively new, efficient van, actual costs tend to give a higher deduction. For those with an older, unreliable van that racks up high repair bills, actual costs also tend to win. The simplified mileage rate is best for:

• Those who do relatively few miles in a year
• Those who want to avoid keeping detailed receipts
• Those using a van that was cheap to buy (little capital allowance benefit)

Once you've used the actual costs method in the first year, you must continue with it for the life of that vehicle. So think carefully before choosing — especially with a new van where the AIA deduction is significant.

What you cannot claim

• ✕Parking or speeding fines
• ✕Personal use of the van (unless apportioned correctly)
• ✕Commuting from home to a permanent place of work (not applicable to most self-employed tradespeople with no fixed workplace)
• ✕Capital repayments on a hire purchase agreement
• ✕Purchase price of the van outside of capital allowances
• ✕Personal travel or holidays in the van

Keeping records for van expenses

HMRC requires you to keep records for at least five years after the Self Assessment deadline for the relevant tax year. For van expenses, that means:

• Fuel receipts (or card statements showing fuel purchases)
• Insurance certificates and payment receipts
• MOT certificate and service invoices
• Finance agreement showing interest breakdown
• Mileage log if you're apportioning for private use
• Van purchase invoice or HP agreement
• Any lease or contract hire agreement

From April 2027, if you're within scope of Making Tax Digital for Income Tax, you must keep these records digitally. Photographing receipts and logging them in MTD-compatible software satisfies the requirement.

Van expenses FAQs

Related guides

• Self-employed tradesperson expenses — full list
• How to track mileage as a self-employed tradesperson
• Tradesman van insurance — what you need
• Sole trader Self Assessment tax return guide
• HMRC Self Assessment for tradespeople