The UK is one of Europe’s most dynamic transport markets. E-commerce is growing fast, demand for same-day and express deliveries is high, and many small clients regularly outsource transport jobs. At the same time, the sector is clearly regulated. Anyone who starts without preparation will pay for mistakes sooner or later. This guide takes you from the first idea to your first paid job. It explains what is required, what it costs, and where typical pitfalls lie – whether you start with a car, van or truck.
To start a transport company in the UK, you must choose the right vehicle class, register your business with HMRC, select a legal structure, take out mandatory insurances and plan costs and taxes realistically. The exact requirements depend mainly on the vehicle weight.
The first major decision is the vehicle class. It affects paperwork, running costs and long-term risk. Vehicles under 3.5 tonnes are classed as LGVs. These include cars, estates and small to medium vans such as a Transit, Sprinter or Vivaro. The big advantage is simplicity. In most cases, no Operator’s Licence is required. This allows you to start quickly and focus on winning work. Many solo drivers deliberately choose this route.
Vehicles over 3.5 tonnes fall into the HGV category. Here the rules become stricter. You need an Operator’s Licence and must meet several formal requirements. The entry barrier is higher, but the earning potential is also greater.
Starting under 3.5 tonnes is the most popular option for new founders. Bureaucracy is limited and start-up costs are lower. No CPC is required, and there is usually no need for an Operator’s Licence. This makes it ideal for testing the market. A common example is a courier operating a medium-sized van around London, handling same-day deliveries. There are no approval procedures, so the focus is on utilisation and reliability.
This model suits single-vehicle businesses very well. It also keeps the door open for later expansion. What matters most is realistic pricing and cost control from day one.
Once your vehicle exceeds 3.5 tonnes, the business becomes more formal. An Operator’s Licence issued by the Traffic Commissioners is mandatory. To obtain it, three core requirements must be met.
First is professional competence. A valid CPC is required, either held by you or by an appointed external transport manager. Second is good repute. Authorities check your background carefully for relevant offences. Third is financial standing. You must prove sufficient reserves, roughly £8,000 for the first vehicle and an additional amount for each extra one.
For this reason, many founders start below 3.5 tonnes and scale up later once cash flow and experience are stable.
Without proper registration, nothing works in UK transport. No contracts, no payments, no credibility. Every self-employed activity must be registered with HM Revenue & Customs before you start trading, whether part-time or full-time.
Choosing the right legal structure is crucial. A Sole Trader setup is quick and simple, with minimal administration. It is ideal for starting with one vehicle, but you are personally liable. A Limited Company limits liability and often looks more professional to larger clients, but it comes with more reporting duties via Companies House.
| Legal form | Advantages | Disadvantages |
|---|---|---|
| Sole Trader | Fast setup, low admin | Full personal liability |
| Limited Company | Limited liability, strong image | Higher admin and reporting |
In transport, insurance is non-negotiable. Without it, you will not get work. Goods in Transit insurance protects the cargo against damage, loss and theft. Many clients require at least £100,000 cover as standard.
Hire and Reward insurance is legally required for paid transport. A standard vehicle policy is not sufficient once you carry goods for money. Driving without it is illegal. Public Liability insurance is equally important. It covers damage or injury at a customer’s premises. One incident without cover can threaten your entire business.
Many new operators fail because of unrealistic expectations. Start-up costs include the vehicle, insurance and deposits. Ongoing costs include fuel, tyres, servicing and repairs. For HGVs, training and licence fees must be added. Your business must also cover your personal living costs.
A simple calculation helps. Fixed costs plus variable costs plus your target income equal the required monthly turnover. Only if this figure is achievable does the business make sense.
In terms of tax, income is paid gross. The tax bill comes later. A proven rule is to set aside around 30 percent of every payment for HMRC. This avoids nasty surprises.
Jobs can be sourced through direct clients, load boards or platforms such as DAGO Express. Platforms are especially useful at the start, as they offer flexibility, no membership fees and visible rates upfront.
Starting a transport company in the UK offers real opportunities, but only with proper preparation. The market rewards reliability and planning, not shortcuts. Choosing the right vehicle, registering correctly, taking out the right insurance and managing taxes from day one creates a solid foundation. Many successful operators start small or part-time, test the numbers and grow step by step. This approach reduces risk and builds a sustainable transport business.
