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Can I claim VAT on Taxi fares? None of the receipts show VAT.

Zero rating of domestic passenger transport does not apply if the vehicle is designed to carry less than ten passengers. Taxi and hire car fares are therefore, standard rated and if the business provider is registrable for VAT, it must charge VAT to customers. Extra charges for baggage, waiting time, etc are also standard rated as are referral fees from other taxi businesses. Tips and gratuities given voluntarily are not payment for supplies and are outside the scope of VAT. VAT due is calculated by multiplying the fares, including extras, by the VAT fraction.

Registered persons (such as a standard rated Taxi driver) must issue a VAT invoice to any customer who asks for one.  If the taxi is VAT registered they should issue you with a receipt which includes the VAT registration number, the date and the amount of the fare which will enable you to reclaim the VAT as Input VAT.  

See also: Catering and VAT

Related topics: Tax & Vat

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