From 2 January 2026, new UK legislation changed how VAT is applied to Private Hire Vehicle (PHV) rides.
Freenow now operates under the Principal Model, which means Freenow purchases your driving services and sells the journey directly to the passenger. As a result, 20% VAT is applied to the full passenger fare, rather than only to Freenow's platform fee.
How does this affect my earnings?
The amount shown on your driver offer is VAT-inclusive. This means the amount you see already includes any applicable VAT.
VAT is not added on top of the offer amount after the trip.
Where can I see my VAT information?
You can find a full VAT breakdown on your weekly self-billing invoice, available in the Driver Portal.
- Taxable Services: Your private hire vehicle tours, waiting times, and applicable bonuses.
- Exempt Services: Passenger tips.
- Your Output VAT: The amount listed under "VAT 20% amount" is the output tax from your Freenow earnings.
- Your Gross Turnover: The total gross payment represents your total taxable and non-taxable earnings paid to you for this period.
What is the Principal Model?
Under the Principal Model:
- Freenow contracts directly with the passenger.
- Freenow purchases your transportation services.
- Your business income from Freenow is the amount paid to you, as shown on your weekly self-billing invoice.
- You do not need to reconcile platform commission invoices, as your self-billing invoice already reflects your earnings.
For more information, please refer to the latest HMRC guidance.
How do I register my VAT details with Freenow?
If you have recently registered for VAT, contact Driver Support and provide your VAT registration certificate.
Once we verify your details, we'll update your account. Your updated VAT information will appear on your next self-billing invoice and in the Driver Portal.
VAT-registered companies
If your VAT registration is under a company, please make sure your Freenow account matches the official company name.
You'll need to provide:
- VAT registration certificate
- Company Unique Taxpayer Reference (UTR)
- Company registration number
After verification, we'll update your account and your new tax details will appear on your next self-billing invoice.
How do I tell Freenow that I've de-registered for VAT?
If you've de-registered for VAT, simply contact Driver Support to let us know.
We'll update your account, and the changes will be reflected on your future self-billing invoices.
Will this change my own VAT obligations?
The changes to how VAT is applied to PHV journeys do not change your own VAT registration or tax obligations.
If you're unsure how these changes affect your individual circumstances, we recommend consulting a qualified accountant or reviewing the latest HMRC guidance.
Need more help?
If you have any questions about VAT or your self-billing invoice, please contact Driver Support.
There are two ways to contact our Driver Care Team:
- Through the Freenow app: visit our Help section and chat for instant guidance, quicker solutions and tailored support.
- Via the Help button: located in the bottom right corner of our support page - recommended if you don't have access to the Freenow app.