Recently, Ulez was expanded to include all of London’s boroughs and self-employed individuals can now seek tax relief for their daily Ultra Low Emission Zone (Ulez) charges.
If self-employed workers use non-compliant vehicles for journeys solely related to their trade, they can claim this relief.
Individuals who are self-employed have the option to include low emission zone charges in their travel expenses when filing their self-assessment tax returns.
It’s important to note that this type of tax relief does not apply to commutes or non-business travel costs.
A spokesperson from Transport for London (TfL) emphasised that the rules governing tax-deductible expenses will be applied conventionally to Ulez charges. However, the tax deductibility might hinge on the specifics of the operation and the circumstances surrounding the incurrence of the charge, as is the case for other expenses.
HMRC, in an official statement, clarified that Self-Assessment customers are entitled to tax relief for travel expenses, including low emission zone charges, as long as they are incurred entirely and exclusively for trade purposes.
When self-employed individuals claim an allowable expense, the entire amount is deducted fully from their taxable profits.