The actual-cost method tracks every vehicle expense, fuel, servicing, insurance, MOT, tyres, depreciation, then applies the business-use percentage at year end. Once chosen for a specific vehicle, you cannot switch back to simplified mileage for that vehicle. Often beats simplified mileage for sole traders doing 15,000+ business miles per year or running expensive commercial vans.
A free CSV template for UK self-employed sole traders to track all vehicle costs in the 2025/26 tax year using the actual-cost method, fuel, servicing, insurance, MOT, tyres, depreciation, parking. Apply your business-use percentage at year end to get the deductible portion. Higher-mileage trades often beat the simplified rate by using actual cost; the trade-off is more record-keeping.
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The actual-cost method tracks every expense for your vehicle, then applies the business-use percentage at year end. This typically beats simplified mileage for trades doing high business mileage (15,000+ business miles/year) or those running expensive vans with heavy servicing costs.
Critical rule: once you've chosen actual cost or simplified mileage for a specific vehicle, you cannot switch methods for that vehicle. The choice is locked the first year you make a claim. If you switch vehicles, you can choose a different method for the new vehicle.
Who this is for: self-employed plumbers, electricians, builders with high business mileage; mobile mechanics, mobile groomers, mobile beauty; couriers + delivery drivers doing heavy daily mileage; any sole trader with a dedicated commercial van.
When actual cost beats simplified mileage: high business mileage (15,000+/year); expensive van with high servicing + insurance costs; high fuel cost vehicle; new van bought in this tax year (AIA on the van + revenue costs).
Estimate of business-use percentage (defended by mileage log showing total business miles vs total miles for the year)
Vehicle purchase price + date (if claiming capital allowances on the vehicle)
Records of any vehicle sale/disposal (for balancing allowance/charge)
How to use it
Open the CSV in Excel, Google Sheets, or Numbers.
Record every vehicle-related expense as you incur it: date, vehicle, cost category (fuel, servicing, insurance, etc.), amount, receipt reference, business-use percentage estimate for that expense, notes.
At year end, total all costs in each category. Apply your overall business-use percentage to get the deductible portion.
Add capital allowances on the vehicle itself (AIA-eligible for sole traders), work out separately from running costs.
Cross-check against your mileage log: total business miles ÷ total miles = business-use percentage. Without a mileage log, HMRC will challenge the percentage.
Why this matters for HMRC audit defence
The business-use percentage is the most contested figure in an HMRC vehicle expense review. A van claimed as 100% business while the household has only one vehicle is implausible, HMRC will assume some personal use.
Defensible patterns:
- Van + separate personal car: easy 100% business for the van
- Van + family second car: defensible 90-95% business
- Single vehicle for both business + personal: realistic 60-75% business based on actual mileage split
- No supporting mileage log: HMRC will impose a percentage and it won't be in your favour
Keep the mileage log AND the cost tracker. They reinforce each other. The mileage log proves the business-use percentage; the cost tracker captures the £ you're applying the percentage to.
Capital allowances on the vehicle: claim AIA on the full purchase price for a van; for a car, you're limited to the main pool (18% WDA) or special rate pool (6% WDA) depending on CO2, with no AIA on cars. This is a major reason vans are tax-preferred over cars for trade vehicles.