Making Tax Digital · Sole traders
How delivery drivers and couriers should report platform earnings
ONLY£15A MONTHA weekly platform payout is convenient for cash flow but may not tell the whole tax story.
A weekly platform payout is convenient for cash flow but may not tell the whole tax story. Delivery income can include fees, tips, incentives, refunds and deductions. A reliable record explains the original earnings and the amount that eventually reached your bank.
Read the settlement statement
Check the platform agreement and the detailed statement to establish what is your income and what has been deducted. Do not assume that every customer charge belongs to you, or that every bank payout is gross earnings. Record genuine platform charges separately where they are your allowable business costs.
HMRC's digital-platform guidance explains that platform reporting does not replace your own records or automatically mean tax is owed. Platform reports use a calendar year; your tax records normally use the UK tax year.
Business delivery insurance, insulated bags, phone mounts and the business share of data costs may qualify. Vehicle costs need their own method. Ordinary clothes and personal food do not become deductible because you bought them during a shift.
If you work through several apps, reconcile each platform before combining income for the same trade. An automatic bank import is helpful, but it may not contain the commission breakdown.
Worked example: two sources of income
Rafi's platform statement shows £900 earned, including tips, and £90 of business platform charges, leaving an £810 payout. A second platform pays £260 with no deduction. Subject to the contractual facts, the records show £1,160 gross income and £90 fees, not £1,070 turnover.
If £50 of the first payout remains in the platform wallet at the review date, explain that balance rather than inventing a missing bank deposit.
Reconcile receipts, not just bank payouts
A bank deposit is not always the original sale. A platform, card processor or agent may deduct fees before sending you the balance. Keep the statement showing the gross amount, deductions, refunds and final payout, then explain the difference in your records.
Cash needs the same attention. Record customer cash when received under the cash basis, even if some of it is spent before the rest reaches the bank. Banking cash already recorded as a sale is a transfer between your cash and bank records, not another sale.
HMRC's record-keeping guidance covers income and business expenses. The useful practical test is whether another person could follow a payment from the original sale to the amount received without counting it twice.
Do not use bank feeds as a reason to ignore payment accounts, credit cards, cash or payments made personally for the business. List every place where business money passes, choose the source for each type of transaction and review transfers between those sources. This turns reconciliation into a repeatable check rather than a search through several unrelated statements.
Start with the business purpose
An expense category describes a cost; it does not decide whether the cost qualifies for relief. The starting point is whether the spending was for the trade. Where an identifiable part was private, keep that part out of the claim. A personal withdrawal is not an expense simply because it leaves the business bank account.
HMRC's self-employed expenses guide explains the distinction between running costs, capital expenditure and private use. For example, a supplier may sell both equipment and household products. The shop's name is useful evidence, but the invoice tells you what you bought.
Record the full transaction and the business calculation clearly. If a £120 bill has £30 of identifiable private spending, a £90 business claim is easier to explain when both amounts and the reason for the split are retained. Do not delete the private part merely to force the bookkeeping total to resemble the tax deduction.
Nor is a deduction a reimbursement. Spending £100 to save a fraction of that amount in tax still leaves you with a real cost. Buy what the business needs, keep appropriate evidence and claim the relief available under the correct rules.
Where this fits into Making Tax Digital
For 2026/27, the first mandatory phase generally covers individuals whose combined qualifying self-employment and property income was more than £50,000 in 2024/25, subject to exemptions. Qualifying income normally means income before expenses. It is a different figure from taxable profit. Check the qualifying-income rules.
Once within MTD, keep the required digital records and send quarterly summaries for each relevant business. The summaries are cumulative from the start of the reporting year. They do not contain your entire personal tax position, and sending one does not itself create a quarterly tax-payment demand.
HMRC does not require accounting or tax adjustments before each quarterly update. Those adjustments and the other information needed for the annual return still have to be completed at the appropriate stage. Keep a review list so a matter deferred until year end is not forgotten. Read HMRC's quarterly-update guidance.
Software can organise the information, but the business facts remain essential. Review the figures you approve rather than assuming that a successful import has also settled every tax question.
Build the weekly habit
Save the settlement reports, compare them with payouts and keep cash tips or other direct receipts in view. Check whether a refund belongs to a previous sale and prevent a wallet-to-bank transfer from being counted twice. Review the reporting period before using a platform's annual total.
Take the next step
Avona.app offers a self-service route from £15/month. Bring your records together, review the figures and choose a workflow that fits your business. For professional help, discuss the scope and total price of Avona Concierge, managed by chartered accountants, before choosing a service.