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Let’s assume both drivers have an annual turnover of £28,800 before deductions.
This equates to £600 per week, based on working 48 weeks a year.
The Flat Rate VAT scheme was set up by HMRC, to simplify VAT for small companies and self-employed courier drivers. This means you can charge VAT at the usual 20% and pay a lower amount to HMRC.
This is the total income you make in a year before any deductions.
Everyone gets a certain amount of income they can earn tax-free. In the UK, this is called the personal allowance, which is typically around £12,570.
Business expenses are costs incurred to run your business, like business fuel, uniform, parking charges etc. These are deducted from your turnover to lower your taxable income.
