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What is VAT?

VAT (Value Added Tax) is a tax levied on the supply of goods and services. When you supply goods or services, including private hire services, you may need to charge VAT if you are VAT registered under UK VAT law. You are responsible for determining when VAT applies, and for accounting for any VAT due to HMRC, including any VAT you may be able to reclaim on eligible business expenses.

How to do your VAT registration

You may need to register for VAT when your turnover from your activities exceeds the VAT registration threshold, or if you expect that your turnover will exceed the VAT registration threshold. This can happen when your income from activities (including income from earnings via the Uber app) exceeds the registration threshold, detailed below. Please note, this includes services purchased from abroad and will include all your earnings (not just from the Uber app).

If you’re new to VAT, this page guides you through the basics of the registration process, including what you need to know if you are:

  • A TfL-licensed driver, or
  • Licensed outside of TfL

Note that if your turnover is below the threshold, registering for VAT is not mandatory, but you can choose to register voluntarily. You should expect the registration to take a minimum of 1 week.

The information on this page does not constitute tax advice. Consult a tax adviser for more details on criteria and requirements that apply to you.

What does VAT registration entail?

VAT registration typically involves:

  • Registering for VAT with HMRC
  • Charging VAT on taxable supplies
  • Periodic VAT returns (usually quarterly)
  • Paying any VAT due to HMRC by the relevant deadlines Keeping appropriate VAT records (for up to 6 years)

TfL-licensed: what your registration involves

VAT on the earnings you make

If you are VAT registered, the VAT you collect from selling your services (including transportation services sold to Uber) must be paid to HMRC with your VAT return. For details on additional earnings from Uber for VAT registered drivers, read here.

VAT on business expenses

As well as collecting VAT, you may also be charged VAT on your business expenses, such as fuel and car repairs. When you are VAT registered, you may be able to deduct this from the VAT you have collected, but make sure to keep copies of your VAT invoices/receipts.

HMRC has helpful websites, such as this one, to help you better understand what you can reclaim.

Non TfL-licensed: what your registration involves

VAT collected from providing and receiving services

If VAT registered, the VAT you collect from selling your services is payable to HMRC with your VAT return. Transportation services sold to Riders are subject to VAT if you are VAT registered. You must collect this VAT and pay it to HMRC as part of your regular VAT return.

The services you receive from Uber are also subject to VAT. The VAT on this business expense falls under HMRC’s special rule: the ‘Reverse Charge’ mechanism. This means that you may need to self-account for the VAT due, i.e. you are responsible for calculating VAT on Uber’s service fee based on the invoice amount and include it as VAT payable on your VAT return.

Note: You do not have to self-account for VAT if you fall under the small business regime.

VAT on business expenses

As well as collecting VAT, you may also be charged VAT on your business expenses, such as fuel and car repairs. When you are VAT registered, you may be able to deduct this from the VAT you have collected, but make sure you keep copies of your VAT invoices/receipts.

HMRC has helpful websites, such as this one, to help you better understand what you can reclaim.

Criteria and requirements

Below the VAT registration threshold of £90,000 per year

As mentioned above, you fall below the VAT registration threshold when your annual turnover is less than £90,000. This means that you are not required to register for UK VAT, and if not VAT registered, you:

  • Do not charge any VAT on your supplies of transport services;
  • Do not have to account for any services bought in from abroad under the reverse charge mechanism; and,
  • You cannot reclaim input VAT incurred on business expenses that continue to be payable by you when you are not VAT registered.

How to get started

If your annual turnover, from all business activities, exceeds the threshold of £90,000, you are required to apply for VAT registration. When calculating taxable turnover, you must include:

  • Total sales: Total value of taxable goods or services supplied
  • Services received from abroad: Value of any services received from businesses based outside the UK subject to the ‘reverse charge’ rule

You must register if:

  • Your combined turnover (sales and services received from abroad) for the last 12 months exceeds £90,000 (the VAT threshold).
  • You expect your combined taxable turnover to exceed £90,000 in the next 30 days.

If your annual turnover is less than £90,000, you are automatically below the VAT registration threshold, but you can choose to register for VAT voluntarily if you wish.

Flat Rate Scheme

When you are registered for VAT and your annual turnover is less than £150,000, you can apply to join the Flat Rate Scheme (you can apply either when you first register for VAT or at a later date).

Under the Flat Rate Scheme, you pay a fixed rate of VAT to HMRC instead, e.g. 10% of your total turnover. In the first VAT-registered year, you receive a discount and can therefore reduce this rate by 1%.

Once you are registered and using the Flat Rate Scheme you are, among other things:

  • Required to charge VAT at a rate of 20% on all services you provide
  • Not entitled to claim input VAT on your local business expenses, except for certain capital expenditures (e.g. a vehicle purchase provided it is used for business purposes only)
  • Required to remit 10% of your VAT inclusive turnover to HMRC

The above is not a comprehensive list of your tax-compliance requirements, but this system can save you a lot of time and effort, since the recording of VAT is much more straightforward. More information about the Flat Rate Scheme can be found on this website.

If you want to know more about how and when to register for VAT, please visit this UK Government website, which contains some useful information. We would also suggest consulting a tax professional.

Your Uber profile

Make sure you include your VAT registration status on your tax profile page via partners.uber.com. This helps ensure that your invoices are generated correctly.

General VAT regime

Make sure you provide us with a valid VAT number (by adding it to your tax profile / invoice settings page). Do not select the "Small-business regime" option.

Flat rate scheme

Make sure you provide us with a valid VAT number (by adding it to your tax profile / invoice settings page). Do not select the "Small-business regime" option.

Small business scheme / below the VAT registration threshold

Make sure you indicate if you are below the VAT registration threshold and have not registered for VAT by selecting the small business regime option in your tax profile / invoice settings page.

Also, if your VAT registration details change at any time, please remember to update your tax profile as well.

Frequently asked questions

  • For information about reporting VAT and filing returns, you can refer to this UK Government website.

  • No, you can also drive as a sole trader.

  • Your turnover is the sum of your income from your activities (including income from providing services via the Uber app). Please be aware that you will likely need to include in this calculation the turnover from any other activities you carry out outside of the Uber platform as well, including services provided to companies overseas.

    We suggest you contact HMRC and/or a tax professional to ensure you are calculating your turnover correctly.

  • Please refer to the Tax Comments prepared by KPMG

Every driver is unique, and so are their specific tax circumstances. As such, the information on this page may not cover your tax needs and it should not be relied upon to replace independent tax advice. Uber cannot provide you with tax advice for your individual situation, and therefore we strongly recommend speaking with a professional tax adviser to get tailored help and advice for your specific circumstances. The information on this page is for British audiences only.

Last updated on 13 May 2026