Q: Client is a UK vat registered taxi business and buys in and resells taxi services to end customers. He understands that it may be possible to use the Tour Operators Margin Scheme (TOMS) for these passenger transport services in vehicles that hold less than 10 passengers, in the UK and so would then ONLY have to account for VAT on any margin achieved instead of the full value. He started making these supplies from 1st February 2026. Can he use TOMS for the resupply of the taxi service from Feb 26 onwards?
A: No. As from the 2nd January 2026 the supply of taxi services ONLY that have been bought in and resupplied without material alteration in the UK will be subject to VAT on the full value and the TOMS scheme cannot be used.
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