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So nothing much changes on VAT, apart from 'ride-hailers'?
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Author:  StuartW [ Wed Nov 26, 2025 6:56 pm ]
Post subject:  So nothing much changes on VAT, apart from 'ride-hailers'?
Normally a Budget speech is something I'd avoid like the plague, but heard a wee bit, which just happened to be the relevant part for the trade, and of course was both tickled and a tad annoyed to hear the chancellor use the phrase 'ride-hailing' :lol:

But apart from the withdrawal of the margin scheme for tour operators that Uber et al have been using, has anything actually changed today?

Doesn't look like it. So the much maligned 'taxi taxi' won't really be happening, in the short term at least :-o

So the current London v rest-of-the-country binary will continue, in the meantime at least. I suspect that, longer term, it'll all be tied up to wider legislative change for the industry anyway.

But presumably this is a fair summary of it all from TaxiPoint, and the full piece contains a link to a Treasury document summarising the responses to the consultation, and outlining the overall position:


WHAT THIS MEANS: Government confirms full 20% VAT will hit private hire fares as TOMS loophole closes

https://www.taxi-point.co.uk/post/what- ... ole-closes

The Treasury has ruled out a reduced VAT rate or sector-specific margin scheme for private hire vehicles and will exclude operators from the Tour Operators Margin Scheme from January 2026.
Author:  Sussex [ Wed Nov 26, 2025 8:23 pm ]
Post subject:  Re: So nothing much changes on VAT, apart from 'ride-hailers
Quote:
But apart from the withdrawal of the margin scheme for tour operators that Uber et al have been using, has anything actually changed today?

No, the likes of you and me are exactly in the same position as we were yesterday.

Whereas Uber etc will, from whatever date the new rules apply, have to charge punters 20% on all fares.

When you also take into consideration the cost to them for holiday and sick pay, they are not going to be as cheap as they want.

Or mug drivers are going to be getting even less of the fare.
Author:  Sussex [ Wed Nov 26, 2025 8:47 pm ]
Post subject:  Re: So nothing much changes on VAT, apart from 'ride-hailers
As for the 'normal' operators that operate a weekly subs business, nothing much will change.

Unless they have been using the tour exemption for their contract/bill direct work. From 2/1/26, they will have to bill VAT on the whole fare.
Author:  StuartW [ Thu Nov 27, 2025 4:09 am ]
Post subject:  Re: So nothing much changes on VAT, apart from 'ride-hailers
A few quotes from the trade bigwigs in this Taxi Point piece (link at bottom), but it's all framed very oddly - the headline must really be about the London industry only, but you need to read the whole piece to pick it all up, and the headline and much of the article just doesn't cover that nuance at all...

I mean, well into the article it says:

Taxi Point wrote:
Today’s announcement provides clarity on the direction of travel, though the operational and pricing implications will take time to filter through.

But a few paragraphs later the London v the rest of England and Wales angle in introduced:

Taxi Point wrote:
Private hire VAT rules will now diverge based on long-standing legal distinctions between London and the rest of England and Wales.

And would have to agree with Uber, who said:

Andrew Brem, Uber’s Regional General Manager, UK wrote:
"This decision also establishes the absurd situation where a trip in London will be taxed at a different rate than a trip anywhere else in the UK.”

Note also he says 'the UK' and not just England and Wales outside London. But, again, there seems to be zero mention of Scotland in all the discussions, while VAT is a national tax applying throughout the UK. So the Treasury and HMRC are bound to have considered the Scottish angle, but I can't see it mentioned anywhere :?

Maybe because it's all a bit messy and awkward as it is, so no need to make it even more complicated :-$



PHV VAT CONFIRMED: Chancellor Reeves applies VAT expansion to all private hire trips in today’s Autumn Budget

https://www.taxi-point.co.uk/post/phv-v ... day-s-autu
Author:  edders23 [ Thu Nov 27, 2025 10:09 am ]
Post subject:  Re: So nothing much changes on VAT, apart from 'ride-hailers
It should not be that difficult for the likes of Uber and bolt to restructure their operational practices to effectively become commission only businesses

The people this hits hardest is going to be the split purse people who own all their vehicles although I can see them going down the route of fixed price rentals which then puts the VAT requirements onto the drivers and then VAT would be on the rental price. It might even be possible to charge rental plus fuel which would enable the operators to claw the fuel vat back

I am certain this will not work as she thinks and the actual improvement in VAT revenues might be as little as half that forecast
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