Taxis and private hire businesses

Produced by a Tolley Value Added Tax expert

Value Added Tax

Guidance

Autumn Budget 2025

Taxis and private hire businesses

Produced by a Tolley Value Added Tax expert

Value Added Tax

Guidance

Autumn Budget 2025

This guidance note provides an overview of the VAT treatment of supplies made by taxi and private hire or mini cab businesses.

Autumn Budget 2025

Legislation is to be introduced with effect from 2 January 2026 to prevent private hire vehicle and taxi operators from using the Tour Operators’ Margin Scheme when journeys are not supplied with, and ancillary to, certain other travel services.

VAT treatment

The zero rate of VAT that applies to passenger transport in vehicles on journeys that take place wholly within the UK refers to supplies in vehicles that are designed to carry not less than ten passengers and supplies by a universal service provider. Taxi and private hire businesses do not qualify as a universal service provider and in most, if not all cases, the vehicles used are designed to carry less than ten passengers. The general effect is that a taxi or private hire business that is, or should be, registered for VAT, is required to account for VAT at the standard rate on its supplies of

Continue reading the full document

To gain access to additional expert tax guidance, workflow tools, generative tax AI, and tax research, register for a free trial of Tolley+™

TAKE A FREE TRIAL NOW

Popular Articles

Personal Tax

Losses on shares set against income

Losses on shares set against incomeUsually, allowable capital losses can only be set against chargeable gains. If the losses are not fully utilised against gains in the year in which they arise, the excess is carried forward to use against future gains. See the Use of capital losses guidance note

14 Jul 2020 12:12 | Produced by Tolley Read more

Value Added Tax

Reverse charge ― buying in services from outside the UK

Reverse charge ― buying in services from outside the UKThis guidance note covers the reverse charge that applies to services that have been bought in from outside the UK. For an overview of VAT and international services more broadly, see the International services ― overview guidance note. For

15 Dec 2020 14:02 | Produced by Tolley Read more

Value Added Tax

UK VAT invoice requirements

UK VAT invoice requirementsThis guidance note provides details of the information that must be shown on a valid tax invoice. Businesses supplying goods and services that are liable to the standard or reduced rate of VAT are required to issue a tax invoice to another VAT registered person.If the

14 Jul 2020 13:46 | Produced by Tolley Read more

Taxis and private hire businesses