Taxation and Driving

People in the UK have to pay tax on their income, which includes wages from paid employment, profits from self-employment, taxable benefits, pensions, and income from property, savings and dividends. Money raised from income tax pays for government services such as roads, education, police and the armed forces.

For most people, the right amount of income tax is automatically taken from their wages by their employer and paid directly to HM Revenue & Customs (HMRC). This system is called ‘Pay As You Earn’ (PAYE). If you are self-employed, you need to pay your own tax through a system called ‘self-assessment’, which includes completing a tax return.

Almost everybody in the UK who is in paid work, including self-employed people, must pay National Insurance Contributions. The money raised from National Insurance Contributions is used to pay for state benefits and services such as the state retirement pension and the National Health Service (NHS). Employees have their National Insurance Contributions deducted from their pay by their employer. People who are self-employed need to pay National Insurance Contributions themselves.

A National Insurance number is a unique personal account number. It makes sure that the National Insurance Contributions and tax you pay are properly recorded against your name. All young people in the UK are sent a National Insurance number just before their 16th birthday.

If you need to apply for a National Insurance number, the Department for Work and Pensions (DWP) may ask you to attend an interview at Jobcentre Plus. People who have not paid enough National Insurance Contributions may not receive contributory benefits such as Jobseeker's Allowance or a full state retirement pension.

In the UK, you must be at least 17 years old to drive a car or motorcycle and you must have a driving licence to drive on public roads. To get a UK driving licence you must pass a driving test, which tests both your knowledge and your practical skills. You need to be at least 16 years old to ride a moped, and there are other age requirements and special tests for driving large vehicles.

Drivers can use their driving licence until they are 70 years old. After that, the licence is valid for three years at a time.

In Northern Ireland, a newly qualified driver must display an ‘R’ plate (for restricted driver) for one year after passing the test.

If you have a licence from another country, you may use it in the UK for up to 12 months. To continue driving after that, you must get a UK full driving licence.

If you are resident in the UK, your car or motorcycle must be registered at the Driver and Vehicle Licensing Agency (DVLA). You must pay an annual vehicle tax. You must also have valid motor insurance — it is a serious criminal offence to drive without insurance. If your vehicle is over three years old, you must take it for a Ministry of Transport (MOT) test every year. It is an offence not to have an MOT certificate if your vehicle is more than three years old.