Q&A WITH TAXNAV: Exploring Making Tax Digital for taxi and PHV drivers with tax expert Paul Oldridge

Making Tax Digital (MTD) for Income Tax has now become a reality for hundreds of thousands of self-employed people across the UK, including many taxi and private hire drivers. With the first quarterly submission deadline fast approaching, there remains plenty of uncertainty around what the new system means in practice, who needs to comply and how drivers can make the transition as straightforward as possible.

To help answer those questions, TaxiPoint is joined by Paul Oldridge, CEO and founder of TaxNav, a software business created specifically to simplify tax reporting for self-employed taxpayers.

Paul founded TaxNav following a successful career in tax software development after selling his previous business. Recognising that HMRC’s Making Tax Digital programme would fundamentally change the way Self Assessment is completed, he saw an opportunity to create an affordable, easy-to-us solution for the millions of taxpayers who do not need complex accounting software. With 5 July 2026 marking the end of the first quarter of the 2026/27 tax year, and taxpayers earning more than £50,000 in 2024/25 now required to submit their first quarterly update by 7 August 2026, the timing could not be more relevant. So let’s jump straight in.

1. Biggest misconception?

The one I hear most is that the job's already done because a booking app like Gett or Freenow already shows their fares. That's useful, but it's not a tax submission, and it's rarely the whole income. A cabbie's earnings usually come through at least three channels: app bookings, card payments taken in the cab, and cash off the rank, and none of those three feed into each other automatically. People think MTD is asking them to start keeping records.

Most drivers already have records, scattered across three different places. What MTD actually asks is for someone to pull those together and report them to HMRC on a fixed quarterly rhythm. That's the job that's been missing and the one that needs to be solved simply.

2. Why is this sector so exposed?

Turnover decides whether you're in scope, not profit. The thresholds are public and HMRC will have informed you if you need to do it this year: but anyone over £50,000 gross income is in from this April, that drops to £30,000 from April 2027, and £20,000 from April 2028. A driver running two apps plus weekend cash work can clear £50,000 in fares without taking home anywhere near that once fuel, vehicle finance, and platform commission come out.

So drivers who'd never think of themselves as a "tax case" are walking into mandation now, and the next two thresholds bring almost everyone else in within three years.

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3. What has the pilot taught you?

Being part of the HMRC pilot was hugely beneficial not just in refining the software experience, but in understanding the issues and concerns users had.

We had taxi and private hire drivers in the pilot and the lesson was consistent. Digital record keeping was never the barrier for this group; drivers rely on mobile apps for their work. What trips people up is consolidation: turning three or four income sources into one accurate figure, every three months, without overclaiming expenses or double-counting platform fees.

The drivers who did well weren't the most tech-confident ones. They were the ones who picked a single place to bring everything together early, instead of trying to reconstruct it the week before the deadline.

4. Practical steps for drivers who know MTD is coming?

Work out which threshold catches you and when, using the £50,000 / £30,000 / £20,000 staging above, and check it against gross fares across all three income channels, not just what lands in the bank. Then pick one place where app payouts, card machine settlements, and cash jobs all feed in, now, not in month two of mandation. Decide whether you're handling this yourself or with an accountant.

The key thing is to choose a system and a software now so you are comfortable you’ll be able to pull the numbers together you need. Effectively all you need is a simple spreadsheet which matches what you write down or view, keep it in one place and you’re all set. Also you can just key the information in if that works better for you.

5. How different is quarterly reporting from Self Assessment?

Self Assessment is one big annual reckoning. MTD IT breaks that into four smaller updates of estimated income and expenses, followed by a final declaration which will be like self-assessment but also will need to be through your chosen software, not HMRC. You're not expected to have polished, audited figures every quarter. You're expected to have a broadly accurate running picture, then tidy it up at year end. The change is rhythm, not rigour: little and often, instead of one large push in January.

6. Most common mistakes?

Treating the app payout as the full fare, when the booking platform's commission has already come off before it reaches you. Forgetting cash jobs because they don't sit on any statement at all.

Mixing the mileage allowance with actual vehicle costs (you can only use one method, not both). And running personal and business spending through the same card, which makes untangling expenses at year end painful and error-prone.

7. How do you see AI, and Navi specifically, helping here?

Navi is like your personal tax assistant. He fronts the technical and tax support built into TaxNav and makes it feel like a guide rather than a piece of software. His job is to point you to what needs doing, when, and where to go if you're not sure or have a question. For a driver juggling two apps and cash fares with no accountant, that's the difference between feeling like you're on your own with this and feeling like someone's pointing the way.

8. With so many MTD options out there, from free tools to software costing hundreds a year, how should drivers think about which one is right for them?

The price range is part of the confusion, not a footnote to it. There are free tools built for VAT- registered limited companies that don't suit a sole trader cab driver, full accounting suites built for people running payroll and stock, and everything in between. Most drivers don't need the expensive end of that range. They need something built for one job, getting accurate numbers to HMRC on time, four times a year, without forcing them to learn a bookkeeping system they'll never use the rest of. That's deliberately where we sit. TaxNav isn't trying to replace Xero or Sage, it's built for the people those tools weren't built for. We charge around £60 a year because the job we do is genuinely smaller than full accounting software, and the price should reflect that.

9. Looking ahead, what's your advice?

Stop treating this as a deadline event and start treating it as a habit. The drivers who'll find this easiest are the ones who build a five minute quarterly check into their routine now, while it's still optional for them, rather than waiting until HMRC makes it compulsory. Once it's a habit, you stop noticing it. That's the whole point: you're sorted, every quarter, without a January scramble.