It depends on the conditions of the restricted licence granted by the Traffic Commissioner. There is "loophole" in the PSV licencing regime that allows a PSV operator to use up to 10% of his licence allocation on vehicles with fewer than 9 passenger seats. My company uses 1 disc on such a vehicle and has a letter from the TC's office permitting it to do so.
This exemption was to allow companies such as Wallace Arnold, who used to run coach tours, to run under 8 seat minibuses as feeders to their main tours. These minibuses could be used anywhere in the country and offered flexibility that would not be possible under the LGA regime.
However, it is my understanding that since the advent of the stretch limo and novelty vehicle market, a substantial number of those operators have tried to licence all sorts of vehciles under either the LGA or PSV regs. The Traffic Commissioners in their wisdom when granting new licences, now put the rider on the licence that a proper PSV operator shall not use any vehicles with under 9 passenger seats on that licence, and any such vehciles under 9 seats in posession shall be licenced as private hire with the local authority. That also applies to restricted licences, which are designed for a taxi/ph business that needs the use of up to 2 16 seaters but not as part of their main business, without the strictness of the PSV licencing regime.
Luckily my company's PSV licence was issued before the rules changed and has no limitationsas to the use of 1 vehicle with under 9 seats.