VAT on cabs: a bumpy ride

Multiple-choice questions. In order to be awarded CPD units you must answer the following five random questions correctly. If you fail the test, please reread the article before attempting the questions again.

Which category of private hire vehicle usually has lower VAT liabilities?

Principal

The level of VAT depends on the type of vehicle

Agent

None of the other answers is correct

Which of the following statements is true? Statement 1, Currently, self-employed drivers are liable for VAT. Statement 2, currently, self-employed drivers are unlikely to breach the VAT registration threshold.

Neither statement is correct

Statement 2 is correct

Statement 1 is correct

Both statements are correct

Under the current regulations, what source of VAT is likely to yield the highest amount?

VAT charged on commissions by PHV operators to drivers

VAT charged by PHV operators directly to passengers

None of the other answers is correct

Both sources provide similar levels of revenue

What were the findings of a 2024 government consultation into VAT rules for PHV operators?

The findings have not been released

The current rules should stay the same

A VAT margin scheme will be introduced

All PHV operators should work towards obtaining TfL licences

If the Supreme Court rules in favour of Uber, what is the likely consequence?

Self-employed drivers will not charge VAT on journeys under five miles

Private hire companies and self-employed drivers will split the VAT on every ride

Self-employed drivers will have to charge VAT on every ride

Private hire companies will have to charge VAT on every ride

Which company is involved in a court case with HMRC over the Tour Operators' Margin Scheme?

Bolt

Veezu

Uber

Delta Taxis

Which of the following statements is correct? Statement 1, PHV businesses that are classed as tour operators currently have lower VAT liabilities. Statement 2, PHV businesses that are licensed by TfL cannot be classed as tour operators.

Statement 1 is correct

Both statements are correct

Statement 2 is correct

Neither statement is correct

When was the Private Hire Vehicles (London) Act passed?

2008

1988

1978

1998

For PHVs outside London, does the Local Government (Miscellaneous Provisions) Act 1976 or the Transport Act 2000 apply?

Either law can apply depending on the size of the vehicle

Local Government (Miscellaneous Provisions) Act 1976 applies

Neither law applies

Transport Act 2000 applies

Which of the following PHVs holds a TfL licence?

Bolt

None of the other answers is correct

Uber

Uber and Bolt

1 unit

VAT on cabs: a bumpy ride

Which category of private hire vehicle usually has lower VAT liabilities?

Which of the following statements is true? Statement 1, Currently, self-employed drivers are liable for VAT. Statement 2, currently, self-employed drivers are unlikely to breach the VAT registration threshold.

Under the current regulations, what source of VAT is likely to yield the highest amount?

What were the findings of a 2024 government consultation into VAT rules for PHV operators?

If the Supreme Court rules in favour of Uber, what is the likely consequence?

Which company is involved in a court case with HMRC over the Tour Operators' Margin Scheme?

Which of the following statements is correct? Statement 1, PHV businesses that are classed as tour operators currently have lower VAT liabilities. Statement 2, PHV businesses that are licensed by TfL cannot be classed as tour operators.

When was the Private Hire Vehicles (London) Act passed?

For PHVs outside London, does the Local Government (Miscellaneous Provisions) Act 1976 or the Transport Act 2000 apply?

Which of the following PHVs holds a TfL licence?

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