Tax Return for Driving Instructors

Though being a freelance driving instructor can often be challenging, it is also very rewarding, while giving you the freedom and flexibility being your own boss brings.

Becoming a freelance driving instructor – training and qualifications

To become an approved driving instructor (ADI) you’ll need to take an exam. The ADI exam comprises of three stages, all of which you have to pass to qualify as a driving instructor:

  • ADI part 1: A computer-based test broken up into a theory test and a hazard perception test.
  • ADI part 2: A practical driving skills test.
  • ADI part 3: A practical teaching skills test.

You can search for ADI course provider on the government website. You’ll need to pass each part of the exam before moving on to the next one. Training is quite expensive, costing a few thousand pounds, but driving instructors earn an average of £22-18k in the first year, moving up to £30,000 or more once they become more

Training with a franchised driving school

You’ll have seen adverts from driving schools about how easy it is to become a driving instructor. In exchange for using their brand to help you find clients, these companies will often charge more for their training. Though being a franchisee with a driving school has a higher initial investment, it can be a good way to quickly find clients with less marketing work in the early days. You can choose to freelance as driving instructor later on, once you’ve gained more experience.

Being a good driver

Even before you can complete your Approved Driving Instructor exams, there are still some other requirements you must meet:

  • You must be over the age of 21, and have held a full UK driving license for at least three years.
  • You must not have been disqualified from driving in the last four years, nor have six or more points on your license.
  • You must take a CRB check to prove that you haven’t been convicted for any other non-motoring crimes.

How to find work as a freelance driving instructor

Whether you decide to go straight into freelancing, or you start by working as a franchisee for a driving school, you’ll need to put some time and effort into marketing your service. Here are a few ways to market yourself as a freelance driving instructor:

  • Directories: You can add yourself to free directories such as, or you could place free adverts on Gumtree. People will find you when they search for driving instructors.
  • Place local adverts: Many people will want to hire a driving instructor close to their home, so placing adverts in local shops and newspapers will target these clients, while being relatively inexpensive.
  • Set up a website: Many freelance driving instructors neglect to use the internet properly, so having a professional website to show your services will make you stand out, while making you look more credible.
  • Word of mouth: If you do a good job teaching your students to drive, they’ll be more likely to recommend your services to their friends.
  • Discounts: Offering discounts when people book lessons in bulk will give people an extra incentive to using your services. You might also want to think about offering the first lesson for free as an extra sweetener to the deal.

Be a better driving instructor, get more customers

Since many of your students will hear about you through word of mouth, the better the job you do, the more customers you’ll get.

Here are a few of the skills you’ll need to be a great freelance driving instructor:

  •  Good at driving
  • Good at teaching
  • Expert knowledge of the Highway Code
  • Good at communicating with different kinds of people
  • Good geographical knowledge, without the use of a satnav

Accounting as a freelance driving instructor

There are various benefits to freelancing as a driving instructor, from the freedom and flexibility to work with a variety of businesses and individuals to more take-home pay. But there is one downside – accounting. As a full-time employee, your tax is usually taken care of on your behalf in the form of PAYE. As a freelancer you’ll have to keep a range of financial records and then prepare and pay a Self-Assessment tax return at the end of each business year. Accountancy can be very confusing and can distract you from teaching your students to drive.

Getting tax and accountancy advice

With most accountants, you’ll pay them to do your year-end accounts, and then they’ll forget about you until the next year. But for your business to be run smoothly and successfully, you’ll need advice on tax and accountancy throughout the year, especially in the early days.

Citi Accounts is different

Citi Accounts provides an affordable and specialist accountancy service designed just for freelancers. Throughout the year we’ll be on hand to give you any tax and accountancy advice you might need, including things like:

  • Take-home pay
  • Which VAT scheme to register for
  • Expenses
  • Tax allowances
  • Choosing between sole trader and limited company
  • Running your business in a tax-efficient way

We charge for our accountancy services in a clear and simple way, which means you’ll never receive an unexpected bill, and you can get in touch for advice whenever you want without the worry of being charged a fortune like you would with many other accountants.