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

Owner-Managed Businesses

Allowable expenses for property businesses

Allowable expenses for property businessesGeneral itemsMany of the principles applying to allowable expenses for property businesses are similar to those that apply for trading and the rules for individuals in a property business are generally the same as for companies with some exceptions which are

14 Jul 2020 13:26 | Produced by Tolley in association with Rob Durrant-Walker of Crane Dale Tax, part of AMS Group Read more

Tax Returns

Employment Tax

Incentives, awards and prizes

Incentives, awards and prizesIntroduction ― incentives, awards and prizesEmployers may use a variety of methods to reward and encourage employees in their work. These are commonly known as incentives, awards or prizes. For the purposes of this note, the term ‘award’ will be used to cover all

14 Jul 2020 11:57 | Produced by Tolley Read more

Corporation Tax

Terminal trading loss relief

Terminal trading loss reliefTerminal loss relief for trade losses in the final 12 monthsTrading losses incurred by a company in the final 12 months leading up to the discontinuance of trade may be carried back for up to three years from the period beginning immediately before that 12-month period.

14 Jul 2020 13:49 | Produced by Tolley Read more

Taxis and private hire businesses