VAT AND PRIVATE HIRE “REEVES PLOTS TAXI TAX” ARTICLE: CLARIFICATION
Jonathan Main, VAT partner MHA, told PHTM: I read the article in the Daily Telegraph with interest and I thought it would be worth providing clarification of the VAT position. While it is certainly true that the Labour Government may use the Budget in November to raise additional tax revenue, the private hire sector is not necessarily an easy target for the Chancellor. As things stand, any operator based outside London can rely on existing HMRC guidance to only pay VAT on account work sold as principal, charges to drivers for access to passenger bookings, and fares earned by an operator’s employees. This position was recently reinforced by the Supreme Court victory for operators outside London. In addition, Bolt continues to
defend its decision to only pay VAT on the profit earned on fares, rather than the full fares paid by passengers. The most recent victory for Bolt was published by the Upper Tribunal in March 2025.
I understand that the case will be heard again in the Court of Appeal in mid 2026. The profit earned by Bolt would reasonably equate to the charges it previously made to drivers for access to passenger bookings. If HM Treasury decides to target the private hire sector as a source of additional tax revenues, it will need to change primary VAT law to require operators to pay VAT in full, regardless of both the legal relationship with drivers and the ongoing litigation with Bolt. This is certainly possible but at the very least would require very careful consideration of existing private
hire licensing regulations across the UK, a clear definition of the type of journeys provided by operators which would be affected by this change, and the self-employed or worker status of drivers. Without this, HM Treasury could not be certain how much revenue would be raised, and the potential for future challenges by the sector. There are far easier targets for the Chancellor that will raise more revenue and have less potential to be challenged in future court processes. In my view, operators should continue to push the Treasury to publish its thoughts on the Government consultation, so that the sector can engage in more meaningful dialogue towards an outcome that suits businesses, passengers, and HMRC.
”
Unique Taxi Telephone Number For London
020 TAXI TAXI
PhoneNumbers.Store Search for TAXI
+44 1329 007 007 32 OCTOBER 2025 PHTM
”
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38 |
Page 39 |
Page 40 |
Page 41 |
Page 42 |
Page 43 |
Page 44 |
Page 45 |
Page 46 |
Page 47 |
Page 48 |
Page 49 |
Page 50 |
Page 51 |
Page 52 |
Page 53 |
Page 54 |
Page 55 |
Page 56 |
Page 57 |
Page 58 |
Page 59 |
Page 60 |
Page 61 |
Page 62 |
Page 63 |
Page 64 |
Page 65 |
Page 66 |
Page 67 |
Page 68 |
Page 69 |
Page 70 |
Page 71 |
Page 72 |
Page 73 |
Page 74
