Taxi and PHV operators begin recording driver revenue for HMRC as from today
Updated: Jan 7
In a landmark move, starting today, taxi and private hire vehicle (PHV) operators such as Uber, FREENOW, and Gett are set to begin recording the income of each and every driver working on their platforms.
This step marks the first phase in a comprehensive strategy to forward these records to Her Majesty's Revenue and Customs (HMRC) in January 2025, as part of an extensive drive to bolster transparency and ensure tax compliance in digital platform transactions.
The UK Government's introduction of the "Reporting Rules for Digital Platforms" legislation is a decisive step towards establishing equitable standards across the digital marketplace. These rules mandate that all taxi and private hire digital platforms gather and submit earnings data from their drivers to HMRC. This sweeping reform is expected to redefine the landscape of digital commerce, particularly for businesses offering services through digital platforms.
With the aim of promoting tax transparency and streamlining the reporting process, platforms will soon start to request additional personal details from their drivers, such as National Insurance numbers. From January 2025, this data will be annually reported directly to HMRC, marking a significant shift in how driver earnings are monitored and taxed.
The legislation, impacting an estimated 2-5 million businesses in the UK, extends beyond taxis and PHVs to encompass a broad spectrum of services available through digital platforms. This includes sectors like food delivery, freelance work, and short-term accommodation rentals.
In a bid to ensure thorough compliance, these digital platforms will also be responsible for collecting and sharing banking details, when available, with HMRC. This data could potentially be shared with other tax authorities to aid in identifying individuals or businesses and assessing their tax liabilities.
This move is seen as a crucial step towards creating a fairer playing field for all businesses within the digital economy. It not only enhances the accountability of digital platforms but also supports the taxation system and national revenue.
