In the London, it’s generally possible to use your taxi for personal purposes when it’s not being used for commercial Cab hire services. but there are a few things you need to keep in mind.
Important Points
Licensing and Certification
Depending on the location and local government, different areas in the UK may have different licensing and certification requirements for operating a taxi hire or private hire vehicle (PHV). Still, there are uniform procedures and guidelines that are typically followed across the United Kingdom. Here’s a general overview:
Driver’s License:
You need to have a valid driving license from the UK or an acceptable driving license from the European Union (EU) or European Economic Area (EEA) in order to operate a taxi or PHV in the UK. Additionally, you might need to fulfill age requirements, which typically mean you have to be at least 21.
Medical Examination:
Drivers of PHVs and taxis may be required by certain local authorities to undergo a medical exam to verify their suitability for driving.
Criminal Background Check:
Verifying a person’s criminal history is done through a criminal background check, sometimes referred to as a criminal records check. Employers, landlords, and other organizations generally use this information to make decisions regarding hiring, housing, and other issues.
Training:
You must obtain a taxi or PHV driver’s license from the relevant local authority. This license will typically involve a written and practical test to assess your knowledge of local geography, regulations, and customer service skills.
Vehicle Licensing:
The process of registering a car with a government agency in order to receive a license plate is called vehicle licensing, sometimes referred to as car registration. The car can legally be driven on public roads with this license plate. Each country has its own set of requirements for vehicle licensing.
Insurance:
For your taxi or PHV, you must have adequate insurance coverage. This insurance must be tailored specifically to commercial passenger transportation.
Vehicle Standards
To ensure the safety of passengers, all taxis in the United Kingdom must meet certain standards. Therefore, The Department for Transport (DfT) sets these standards, which are enforced by local councils.
The following are some of the key safety standards for taxis in the UK:
- The taxi must be mechanically sound and possess a current MOT (Ministry of Transport) test certificate.
- The taxi must have seatbelts for all passengers.
- The taxi must be clean and comfortable.
- The taxi driver must be licensed and have a good conduct certificate.
- The taxi driver must be able to speak English.
Taxation
The taxation system for taxis in the UK involves several key aspects, including Value Added Tax (VAT), income tax, and other taxes and fees. Here’s an overview of the taxation system for taxi drivers and operators in the UK:
Value Added Tax (VAT):
VAT (Value-Added Tax) is a tax on goods and services in the United Kingdom that is added to the price of goods and services. Cab hire services are VAT-exempt, which means taxi drivers and operators must charge VAT on their fares. In exchange, they can claim VAT back on certain business expenses. Taxi drivers and operators must register for VAT if their annual turnover exceeds a certain amount. Once registered, they must charge VAT on all their fares. However, They can then claim back VAT on certain business-related expenses, such as vehicle maintenance and fuel.
Self-Employment and Income Tax:
Many taxi drivers are classified as self-employed. Which means they must pay income tax on their earnings. They must declare their income to Her Majesty’s Revenue and Customs (HMRC). Which includes fares, tips, and any other income related to their taxi operations. Taxi drivers can reduce their taxable income by deducting allowable expenses such as fuel costs, vehicle maintenance, and licensing fees.
Vehicle Excise Duty (VED):
Vehicle Excise Duty (VED), also known as road tax, is a tax that taxi drivers in the United Kingdom must pay for the privilege of driving on public roads. Therefore, The amount of VED that taxi drivers must pay is determined by several factors, including vehicle type, emissions, and list price. Taxi drivers should be aware of their vehicle’s VED rates and categories, as well as any potential exemptions or discounts based on emissions and fuel type.
Fuel Tax:
Fuel duty is a tax on gasoline and diesel used in automobiles. Taxi drivers who use fuel for business purposes may be eligible for a fuel duty rebate.
Corporate Income Tax:
Cab hire companies may be required to pay corporation tax on their profits. However, This tax rate can vary and is typically applied to the taxable income of the company.
It’s important to note that while you can use your licensed taxi for personal use when it’s not serving as a taxi. You must adhere to all relevant regulations and requirements when providing Cab hire services. Failing to do so can result in legal issues and penalties. Additionally, if you are using a ride-sharing platform like Uber in the UK. However, There are specific requirements and regulations that apply to drivers, and you should ensure compliance with those as well.